Hut head picks up Softbank stake

SoftBank decided to exit the business completely just a few months after an arrangement to buy a fifth of its Ingenuity division was cancelled. This now looks like a lucky escape. SoftBank sold its entire holding of 80.6mn shares at 39p a pop on 17 October, with 84 per cent being picked up by a division of the Qatar Investment Authority, a sovereign wealth fund. The remaining 16 per cent was bought by FIC Shareco, a company closely associated with THG founder and chief executive Matthew Moulding. Through direct and indirect holdings, he now owns 321mn shares, or around a quarter of the company.

The market reacted positively to the trading update’s maintenance of full-year guidance. THG still expects revenue growth of 10-15 per cent, a cash position of around £500mn and adjusted cash profits of £100mn-£130mn. And a new, £156mn banking facility will help to shore up its liquidity position. But revenue growth is slowing, down to 2 per cent in the quarter from 12 per cent in the first half. Numis analysts said that “weakening organic momentum increases risks to current and outer year forecasts which, as with other ecommerce names, may require a more radical approach to [the] rightsizing of costs.”