Member Info for Hosai

Whilst it's true that THG is the most down from its UK peers - down 86.5% in a year, boohoo isn't actually that far off - down 75.42% in a year.

As has been said, the trend has been so bad in the short term that even bulls don't want to buy atm

Current market cap at £1.22 billion is lower than that £1.3 billion Charlotte Tilbury sold her loss making beauty brand for which had £258.5 million a year revenues...I know it's not quite the same and it's a good beauty brand but still.
https://www.theguardian.com/business/2021/dec/23/charlotte-tilbury-repays-furlough-cash-as-sales-soar

I do slightly agree with another poster that "even bulls don't want to buy atm". Whilst I predict it will go up one way or another in the medium/long term its hard to buy right now with such a bad short term trend. I am just holding (from £2.18 average)

In that case pencil...current MC is even lower than I thought and google is correct. One of the reasons I prefer being in THG over boohoo atm is boohoo is mostly down on sector sentiment, whereas THG is down on both sector sentiment and lack of strategic update. I believe THG will rise on pretty much any strategic update no matter what it is once they decide which way they are going to go.

I know this has been said a lot but if THG were rejecting £3.9 billion offers back in 2018...then there is no way they believe the current £1.37 billion market cap (according to their website) is fair value. If they did believe that they would have bitten off PE's hands in 2018. Those multiple offers were before all the growth, IPO acquisitions and debt reduction since then.
IMO at some point even though they go full blown commitment to listing - i.e aim for premium listing, add chairman and share buyback. Or PE is helping MM and co buyout shortly.
https://www.retailgazette.co.uk/blog/2018/09/hut-group-rejected-3-9bn-takeover-bids-continues-aggressive-growth/

Perhaps pencil, either way it didn't change overall between the last 2 quarters.
Q3 = "The Group has a very strong liquidity position as it enters its peak trading season, with available cash as at 30 September 2021 of c. £700m including long dated 3-5 year facilities."
Q4 = "Total cash of over £530m at year end plus an undrawn facility of £170m, on long dated 3-5 year terms."

Venture yes I could add in the debt due however I did also value all their recent acquisitions at 1 x the revenue they made pre-THG which seems pretty conservative as most online retail have higher p/s therefore there is a implicit discount there for other factors such as debt. I didn't say it was perfect, just a way of looking at things and seemed too stark not to point out.

This is the revenue all their post-ipo acquisitions were making before THG bought them:

2020
Dermstore - $200 million / £147 million
Pericone MD - $60 million / £44.12 (I think but can't find, could be wrong but saw somewhere it was bought at 1x revenue?)
Claremont ingredients & Dave Berryman – Can't find but expected to add £15 million

2021
Bentley labs - $66 million / £48.5 million
Cult Beauty - £123.4 million
Brighter Foods - £20 million

If we were to value all these acquisitions at 1x revenue which would seem fairly conservative we get £398.02 million, plus £530 million cash end of year (cash was unchanged from quarter 3) = £928.02 million

Current MC = £1.36 billion - £928.02 million = £432 million.

This would mean if you strip away cash and post-ipo acquisitons (valued at 1x the revenue they making pre-THG), the rest of the entire company including My Protein, Look Fantastic and Ingenuity are currently valued altogether at £432 million.

Well said Anacott, maybe Matt M should close with that line at the end of the next update? Just kidding, market might not take that well haha.

Bantham this betavilles profile:
"I have spent the last fifteen years working in financial journalism at the highest level in the United Kingdom covering mergers & acquisitions, private equity, hedge funds, stockmarkets and restructuring.
I began my career on trade publications, such as Financial News, Air Finance Journal and Mergermarket.com. In 2005, I joined The Daily Telegraph as its first ever M&A correspodent and broke several major stories, such as Qatar's attempt to buy J Sainsbury for £12 billion in 2007. I have also written extensively for The Sunday Telegraph following the merger of editorial teams at the Telegraph Media Group.
In 2013, I left the Telegraph Media Group to work on freelance basis and have since been published in the TheSunday Times, The Times, the Daily Mail, the Mail on Sunday, Private Equity News, Financial News, the Australian Financial Review and Dealreporter.
I set up Betaville in 2014 and have broken several agenda-setting scoops, including the £3.5 billion merger of Carphone Warehouse with Dixons Retail."

You think he never came across the takeover disclosure protocals before? Or has he just lost his mind in continuing to report on this. I am not saying I KNOW the rumours are true, or that there will be any bids etc, I'm just saying I don't believe you are correct in being certain they are not true and I can't help but think this guy would be likely to know better.

It's crazy that betaville is still posting about the THG rumours to his paying subscribers. Earlier today he wrote "Strange, though, that the company failed to broach, or indeed deny, the issue about private equity interest in the business..."
Bantham really needs to let this guy who has 15 years of experience working or major newspapers on mergers and acquisitions that this story simply cannot be true because THG didn't previously release a 7am RNS to confirm it.

https://twitter.com/manxmarkets/status/1496057647203766276

It couldn't be £1.30...unless they convinced every institution not involved in taking it private to sell at this price. This doesn't seem likely. Assuming soft-bank were involved in taking it private it would have to be £5.96 until May. After that it would have to be at-least £1.90 until Nov 22nd as that's what Sofina bought at. Again if sofina weren't involved in taking it private it wouldn't have to be this price but then they'd have to convince Sofina to sell at £1.30 which seems rather unlikely so they would block it.

Can you explain why they have increased their workforce by around 3,000 people recently and just opened a Leeds ingenuity office if they are "going bankrupt" NurI?

Jtan, it's true that you said "you can't wait to buy at £1", but then yesterday you were saying "if it goes under £1 its going to TANK" and then that you were going to buy at "40p" and then I believe "10p".
So you say quite a lot things...

"WW3" is trending on twitter...tomorrow is going to be fun. As you say, prob best to switch off for a while.

Only partly related to THG but Times says this in regards to Chrysalis:

"Chrysalis said that NAV per share stood at 237.86p on December 31, representing a 5.6 per cent decline since September. It attributed the loss to the decline in share prices of companies it backs, notably THG, the online retailer whose shares slumped by 55 per cent in the fourth quarter; and Wise, the money transfer business that shed 30 per cent over the same period.
“We have commented extensively regarding the performance of THG previously, but, despite delivering strong numbers, the extent of Wise’s de-rating is disappointing,” the company said. The FTSE 250 group also blamed the modest fall in the valuation of Klarna, the “buy now, pay later” lender that dominates the group’s portfolio.
Nevertheless, analysts at Liberum were bullish, arguing that the NAV update was about 5 per cent ahead of market expectations. “The majority of the companies are operating in large addressable markets and have substantial revenue growth potential,” Conor Finn and his team said. “We expect further liquidity events and valuation catalysts across the portfolio companies.”

https://www.thetimes.co.uk/article/chrysalis-rues-the-woes-of-its-technology-stars-jtrkhdjgp

I had thought blackrock had fully sold a few weeks back, but perhaps I was mis-reading the article - it's slightly vague in a sense, this is back from Jan 27th:

"After six straight sessions in the red, THG was back on investors’ shopping lists amid chatter in the City that one of its cornerstone investors has hit the pause button on selling shares in the troubled e-commerce group.
BlackRock has “finally finished” selling THG stock, according to Reuters, lifting spirits among investors who have watched the shares tumble in the past few months.
The American asset manager, which has been an investor in THG for about ten years, offloaded about half its stake— or 58 million shares — last November, weighing down the share price. A month later, it trimmed its stake down below five per cent.
THG shares have been under pressure this week amid a sell-off on Wall Street that swept over to the UK. Some City traders were less surprised by the uptick in the share price, with the shares at their lowest on record and buyers on the hunt for bargains.
The shares have “fundamental value” for RBC, which defended the prospects of its Ingenuity technology arm in a bullish note. They recovered 10¼p, or 8.5 per cent, to close at 130p."

https://www.thetimes.co.uk/article/shares-put-on-a-shedload-to-bring-relief-at-the-hut-9zmpk3thc

So Betaville just decided to put this out there for his paying subscribers despite knowing the story could never be true as no rns previously? And two days later the telegraph just randomly throw out that THG are preparing a bid defense.

transcript of betaville here - https://twitter.com/anonymous091222/status/1495839459660681218

I gave you 2 possible reasons, market doesn't think PE will in the end make a bid, or market doesn't think MM actually wants to go private.
I find it implausible that the bevaville writer is still putting out the (uncooked) ongoing rumours to his highly paying subscribers despite knowing none of them can be true because there was no 7am RNS last time. Could it just possibly be that the rules are not so certain as you keep making out?