British e-commerce retail firm THG shares have reportedly jumped up following the news of Japan’s SoftBank selling its stake within the British online shopping group to THG’s co-founder Matthew Moulding and Qatar’s sovereign wealth fund.
The move has reinforced Moulding’s control of THG, earlier known as The Hut Group, which holds a range of internet health and beauty retailers and ended rumors regarding SoftBank’s disastrous investment.
The Japanese firm operated by Masayoshi Son, its founder, is reportedly offloading its stake once valued at $563 million (£500 million) for $34 million (£31 million), suffering a loss of $507 million (£450 million) on its investment.
It acquired an 8% stake in TGH for $541 million (£481 million) in May 2021 to assist in fund expansion of its technology platform months before it floated in London.
According to sources, during the time of early trading, the shares of THG rose by 10%, and even later, they traded 9% higher at $0.56 (49.9p).
Nevertheless, the value of shares has fallen by almost 86% over the past year, as the business was struggling with slow sales.
For the unversed, THG was established in 2004 by Moulding and John Gallemore, who started selling CDs and DVDs online for retailers.
Lookfantastic, Zavvi, Glossybox, and Coggles, and beauty brands, including ESPA and Illamasqua, and the sports nutrition brand Myprotein are some of the retail websites owned by THG.
The disposal of SoftBank comes as the firm decides to settle its internal hedge fund SB Northstar, which registered losses of nearly $6bn (£5bn).
Furthermore, THG has stated that SB Northstar had agreed to sell its entire shareholding, 80.6m THG shares, to Moulding and Qatar Investment Authority (QIA).
For the record, the shares will be sold at a price of $0.43 (39p) each, below the closing price of $0.50 (45p) on Monday. Reportedly, QIA, already a shareholder, will purchase 84% of the shares.
Source credit - https://www.theguardian.com/business/2022/oct/18/thg-shares-rise-softbank-sells-stake-moulding-qatar