THG ends takeover talks with US buyout firm Apollo
Shares in the company, which owns platforms including Cult Beauty and MyProtein, dropped as a result.
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Your support makes all the difference.Online retail firm THG said it has ended talks with private equity giant Apollo over a potential takeover deal.
Shares in the company, which owns platforms including Cult Beauty and MyProtein, dropped on Friday morning as a result.
Last month, the company, previously known as The Hut Group, said it received an initial takeover approach from US buyout firm Apollo, helping shares to jump 40%.
The board remains fully confident in THG's strategic direction and long-term prospects as an independent company
But on Friday, THG told shareholders “there is no longer any merit in continuing to engage with Apollo” over a possible deal.
“Consideration and rejection of the indicative proposal has been on a basis consistent with all previous offers for the company, some a matter of public record, which were also rejected based upon inadequate valuations and the nature of those offer structures,” the company added.
THG also confirmed in the stock market update that improvements in profit and cashflow from the first quarter of the financial year have continued into the latest period.
It said action taken by management since last year to reduce its capital expenditure, improve efficiencies and decreasing whey commodity prices have helped to improve profitability.
Lord Charles Allen, THG chairman, said: “THG’s board, in accordance with its fiduciary obligations and as demonstrated with its recent engagement with Apollo, will always give due consideration to all potential options which provide the opportunity to maximise value to THG’s shareholders.
“The board remains fully confident in THG’s strategic direction and long-term prospects as an independent company.
“As stated in our recent results, with a strong balance sheet and category leading positions within substantial global end markets that continue to benefit from long-term structural growth, we have confidence in our ability to deliver long-term value for shareholders and remain on track to be cashflow positive in 2024.”