Jun 29, 2020
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Speculation mounts over £5bn Hut Group stock market debut

Jun 29, 2020

There’s speculation that fast-expanding beauty giant The Hut Group (THG) is mulling a stock market flotation. A report at the weekend said that it has been lining up meetings with some big-name investors.

The Hut Group has long been rumoured to be mulling a stock market listing - DR

The Sunday Times reported that it has spoken to Schroders, T Rowe Price and Fidelity.

But finance director-turned-entrepreneur Matthew Moulding, its founder, has denied plans for a float saying the firm speaks to “major global investors about future investment” every year. He’s reportedly keen to retain control over the company, although a stock market listing wouldn’t necessarily remove this. 

A quick look at Boohoo, where its founders remain at the helm and with controlling stakes, shows how dynamic businesses can prosper in the full glare of stock market listings.

And THG certainly is dynamic with the newspaper saying that despite its denial, its fast growth and subsequent estimated £5 billion value could be too much to resist.

The report also said a number of online retailers that are in private hands are being encouraged to consider a public listing after the lockdown further accelerated the consumer move to e-shopping that was already happening fast before the pandemic hit.

THG is seen as a particularly attractive candidate for a listing given its rapid growth in the beauty and wellness sectors for which the internet will be even more important in future. 

Matthew Moulding has built it into a major force in both beauty and e-tail with a strong reputation for technology and for buying brands with big potential such as Eyeko and Illamasqua. The company also owns brands such as Glossybox and Lookfantastic and the group's sales of £80 million a decade ago turned into £1.14 billion last year, while underlying earnings bounced up by 11% to £111 million.

The company has been backed so far by private equity firms KKR and BlackRock, plus ex-Tesco chief Sir Terry Leahy. It also raised nearly £1 billion in debt and equity late last year with the firm saying it wanted to make more acquisitions.

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