A $1.6bn deal that would have seen Japanese investment giant SoftBank take a near 20 per cent stake in a major division of Manchester-headquartered ecommerce and software giant The Hut Group (THG) has been abandoned.
It was announced in May 2021 that SB Management (SBM), a division of SoftBank, had bought an option to acquire a 19.9 per cent holding in THG Ingenuity that valued it at $6.3bn. It was also confirmed that SBM would also buy a $730m stake in Manchester-headquartered THG, in which it already holds a six per cent stake.
However, THG has announced in a statement to the London Stock Exchange today that the deal has been terminated by mutual agreement due to “global macroeconomic conditions.”
THG confirmed in the same statement that it has “completed the internal separation of its key trading divisions” to offer “flexibility to enter into future strategic partnerships to generate value accretion for its stakeholders”.
The announcement comes after shares in THG slumped to an all-time low after two investment companies behind a potential £2.07bn takeover bid confirmed they will not make a formal offer for the company.
Belerion Capital and King Street Capital Management made the announcement after they first revealed an offer of 170p per share last month. Belerion’s co-founder and chief investment officer Iain McDonald is a non-executive director of THG.
It was later confirmed that Nick Candy, the property tycoon who was recently involved in a bid to buy Chelsea FC, had also pulled out of a £1.4bn move to takeover the Manchester giant, home to brands including Cult Beauty, ESPA and Perricone MD.
Shares in THG, as of 10.15am on Tuesday, July 26, were down 1.6 per cent to 68.88p.
