The Hut Group Filed For An IPO

The Hut Group Filed For An IPO

over 3 years ago2 mins

Finally, signs of a pulse from the bedridden British IPO market: ecommerce company The Hut Group (THG) announced plans for an initial public offering on Thursday 📣

What does this mean?

THG’s best known as an online retailer of health and beauty brands, but it also sells its ecommerce technology on to other companies 💻 And seeing as ecommerce has emerged from the pandemic with a spring in its step, now seems as good a time as any for the company to sell shares to the public.

As part of the announcement, THG revealed its revenue increased by almost 36% in the first six months of 2020 compared to the same time last year 📈 It also mentioned it’d be targeting overall revenue growth of 25% over the next few years. And given that the company put its valuation at just shy of $6 billion, this’ll be Britain’s biggest IPO since 2013.

Why should I care?

Only seven companies have IPOd in the UK so far this year – the fewest since 2009. US and Chinese IPOs, meanwhile, have been booming, which could be down to a couple of factors. In the US’s case, it might be because its stock market is breaking records almost daily, while the UK’s hovers 20% below its peak 🇬🇧 That makes companies more inclined to sell shares – and hopefully get a higher price – in the States. As for China, it’s been benefiting from souring relations with the US: the country’s firms are “coming home” and IPOing on the Chinese and Hong Kong stock markets instead.

*As of June 10th, 2020
*As of June 10th, 2020

Turns out THG’s IPO will include an unusual feature: the company’s co-founder and CEO will get a so-called “golden share” that’ll give him the power to veto any attempt at a hostile takeover for three years 🚫 And since that means the stock can’t be included in the UK’s key index – and that investment funds which track the index won’t be forced to buy it – demand could end up suffering.

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