THG has raised £95.4m to pay for the spin-off of its loss-making tech division, Ingenuity – more than the £75m it was originally seeking.
Matthew Moulding, the CEO of THG invested £10m in the oversubscribed fundraise, which was also backed by new investors and existing shareholders.
One of those existing shareholders is Frasers Group, which said it had made a £10m strategic investment. That’s in addition to the multi-year partnership signed this summer across several areas of the group – including a multi-year Ingenuity deal, its credit and loyalty platform, Frasers Plus, being made available to THG’s Beauty and Nutrition and launching a range of Myprotein products in-store at Sports Direct.
Moulding, alongside Sofina, Mark Evans, Sir Terry Leahy, West Coast Capital and Brian Kennedy are thought to account for around £33m of the equity raise.
The North West group stated that it would now demerge the Ingenuity division, to “facilitate the simplification of THG’s business model as a cash generative global consumer beauty and nutrition group, with an improved balance sheet, capex and cashflow profile.”
It will mean THG Ingenuity will become a private company, as THG PLC remains publicly listed.
Separately, in a third quarter trading statement THG revealed growing revenue in both its Beauty and Ingenuity divisions, they were up 2.3% and 15% respectively year on year.
Nutrition, however, was down 13.1%, although the company said that sales had recovered from July and had “improved steadily” through the quarter.
Its total revenue was £442.8m, down 5.2%.
“It was especially pleasing to see another solid quarter of delivery from both our Beauty and Ingenuity businesses, rewarding the significant overhaul of their respective operating models during 2022 and 2023. The short-term disruption from the major rebrand of Myprotein is now behind us, and we were pleased that in September Nutrition delivered its best sales performance since January,” explained Matthew Moulding, CEO of THG.
“We are also proud to be recognised in the top 250 companies worldwide for our contribution and efforts in sustainability thanks to our ongoing progress towards our net zero goals.
“Preparations for our busiest trading period are well advanced with efficiencies across the network over the last twelve months delivering further benefits for our Ingenuity clients to aid new customer acquisition.”
