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Any thoughts on potential price effectively rejected Oke?

The way I see it if Apollo really did view ingenuity alone as significantly more than pre bid THG (66p), then unless Apollo hugely undervalued Nutrition and Beauty than the kind of prices bandied around must have been at a huge premium, arguably in the £2.50 - £3 range?

As it's not hard to get to £2 just from Nutrition, Beauty and the tax losses IMO.

It still makes a difference if golden share goes, because if sp stays low and Matt M keeps rejecting higher offers and the sp doesn't then move up near those rejected offers then his "friends" could start to get disgruntled.

I actually trust Matt M a bit more than I'd say the average on here however would have great to have had an actual price they rejected in an RNS. Market would have trusted it coming from Apollo, unlike Belerion.

However it probably was a case of number flying around but obviously when it became clear it the structure wasn't going to work there was no firm offer to ever reject. So annoyingly are have left with hoping the papers this weekend give out the kind of price that was effectively rejected.

If Matt M is truthful which I believe he was that Apollo valued Ingenuity significantly higher than pre-bid THG (66p) then it has to have been a very high price to premium to here that was effectively rejected.

I sort of agree on buyback Oke however I suppose a buyback is the only way to benefit long term from a low sp or shorts/media attacking the sp. Darktrace did it at a point where they had less cash than THG do.

However in retrospect the best time to do it would have obv been when sp was in the 30s.

I know its ridic to make predictions here but I'm hoping early next week. They said "final stages" and for first time said "during month" rather than "end of".

On the one hand I'm obviously not surprised the sp fell today. On the other in a sense I'm surprised it didn't shoot up after Matt Ms linked in post.

He's said Apollo viewed Ingenuity as "significantly more valuable than the whole of THG the day before the bid leaked".

Day before it leaked the sp was 66p - "significantly more" you would have to say means at-least £1 for ingenuity?

For Nutrition I don't see how it can viewed less than £1.67 billion. I know I bang on about Fever Tree but Nutrition makes better revs and EBITDA so should at the very least be at the same value so that's another 128p conservatively.

That's already £2.28p without adding THG Beauty which makes £1.2 bill revs each year or THGs tax losses to carry forward.

Therefore in a sense it would appear THG have effectively rejected a huge bid as they regard it as significantly undervaluing THG?

Of-course this is taking Matt Ms word for it about their Ingenuity valuation.

I share buyback would be good. Most analysts seem to ignore the large amount of cash THG have anyway so I don't think a drop would harm things too much. The debt doesn't mature until Dec 2026.

If they did a buyback now it could look like great business in 6 months time if online/growth shares has started to re-rate with inflation continuing to fall and first interest rate cuts.

If we try and ignore the swings in sp in the last month we've had SOTP from Bloomberg analysts around £2, Kelso saying similar, and now Apollo valuing ingenuity at around £1 billion according to Matt linked in note.

Previously it's been harder to value ingenuity so people here conservatively put it at £0 when doing SOTP valuations just to make a point of how undervalued Nutrition/Beauty is.

What's frustrating is it seems a deal wasn't impossible and likely at a big premium but didn't quite work, the £ wasn't the problem for Apollo though it was the control.

Obv was fairly disappointed with the news however that Matt M post seemed very bullish. This line is crazy to consider - "Their latest view on Ingenuity had it as being significantly more valuable than the whole of THG the day before the bid leaked!"

Most of the analysis put ingenuity commerce at £0. Its not clear if they mean ingenuity or commerce here but either way if they are giving say £1 billion to ingenuity. After that I don't see how they could value Nutrition less than Fever Tree which is at £1.67 billion (THG Nutrition on it's own generated £675 million revs and £51.8 million EBITDA for FY2022 in a year with ridic high protein prices. Fever tree who are a smaller brand than Myprotein and generated £344.3 revs and £39.7 million EBITDA)

Therefore £1.67 billion seems conservative for THG Nutrition. So if Apollo thought ingenuity potentially worth £1 billion then for the two you already would have £2.67 billion around 176p I believe. You then have to add THG Beauty and THGs tax losses.

This makes me wonder what their bid must have been, it surely must have been well above £2. Especially as they said they were preparing an even better bid but Matt M didn't like the structure still.

Interesting to note, Mark Kleinman didn't break the Candy or Belerion bid news, in-fact I can't see record of him ever commenting on them. If you search for keywords on google it mostly comes up with journalists such as Ashley Armstrong questioning or mocking the bids.

However he broke the cult beauty acquisition story the evening before it was confirmed and also as we saw was correct on THG's new NED appointment the day before.

https://twitter.com/MarkKleinmanSky/status/1422634987346616323

He also broke the story in Oct 2021 of Matt M to announce his intention to get rid of golden share the day before - https://twitter.com/MarkKleinmanSky/status/1449314468303974401 (obv as we know this hasn't happened but still was an exclusive at the time).

The other story he broke was Numis reporting themselves to the financial authority (or atleast sky news did) - https://twitter.com/SkyNews/status/1461048913461497859

Finally recently he broke the news of them about to hire new NED Sue Farr - https://twitter.com/SkyNews/status/1650182762656157700

Obviously this was withing the same story emphasizing detailed talks, a steep premium and "analysts expecting the board to recommend to accept the offer".

It seems he has a good track record and also potentially gets given scoops that THG want to get out there.

If there was no deal, whilst it would obviously be a painful day, I still think with the massive fall in wholesale energy prices inflation will continue to fall as it has been in the US well into next year.

I can foresee by the end of year the sp rising on it's own up to £1.50/£1.75 with the expectation of first FED pivot and interest rate cut by late autumn/early winter. By this point it's not like PE offers will be gone, however if the sp had got to £2 say then £3 offer would only be 50% premium on price.

Can obv see there being a lot more activity once golden share goes in Sept, Kelso stated they would be "very surprised" if there wasn't a lot in other potential bidders even now.

I still of course hope there is a deal now as it's quicker money but the way I see it, THG have a decent amount of cash and in-fact in the last few months were cash flow positive so a deal doesn't HAVE to happen, you just have to be able to stomach a short term fall in sp in this scenario.

"Why doesn't he really turn the tables? Make the hard decisions - Cut costs more, boost margins and cash flow, increase revenues - and the market will respond."

Lol Jeff that's exactly what they announced in the last update (other than attempt to increase revenues) but you are kind of asking for everything here. The city don't care they've decided they hate THG and Matt M either way. Just look at their divisions valuation next to peers, it's pretty obvious it's undervalued but as I said the city doesn't care the sp is too easy to manipulate and they can make money from it that way hence they ignore the SOTP valuations given (even the 200p odd one in the bloomberg note), Matt M needs to try and go private or at-least getting premium listing would help a little.

If there is no deal then unfortunately it could be a great excuse for them to drop the price a lot, however as others have said I think it would be bought back quite quickly.

Binky it's been falling since 117p with ppl saying its falling that means no deal so lots of longs who bought for the bid are no longer in, and many will have already re-opened shorts based on the price action (rightly or wrongly).

It's ridiculous but shows you can't be listed in UK if not paying dividends.

Fever tree on lower revs and EBITDA than myprotein but valued at £1.68 billion. Meanwhile the entire valuation of THG hanging onto £1 billion.

Only consolation is if shorters tried to take it to a ridiculous level again on no deal they could/should do a share buyback.

In some ways this prob is what it's like to be invested in a private company about to IPO but IPO date and price info keeps being delayed (admittedly with some audit issues thrown in but feel better after having had the independent investigation results not as bad as feared).

As Oke pointed out the recent effective insider buying here is crazy, none of it reported in the media. Belerion, Balderton, Vanguard and arguably Brian Kennedy. (Kennedy was reported in news but his proximity to THG in terms of location as some here alluded to wasn't emphasized in media).

I think Matt M will care a bit in terms of if it's under £1.70 he would annoy a lot of people having said that significantly undervalued THG. He would also find it hard to ever re-list again as people would be wary of "what he did last time".

However once it's over £2 I don't think he would care that much it would mostly be about him being a middle man in trying to get a price other large holders who aren't part of the new co will sell for and what Apollo will pay.

Don't know where I stand on city spy, this always seems too much though like I can't see it being legit, but I hope I'm wrong - "The noise here is that something is close. Don't go for any long lunches for the next few days!" https://twitter.com/TheCitySpy/status/1656610923602124802

Still if no deal then I imagine CS will lose more credence so he/they is putting themselves out there.

The sky article is the last thing we heard, haven't had much since then other than a share price fall apparently influenced largely by a dodgy bloomberg headline. Also has been large falls in ASOS/Boohoo in this time. Sky said this - "Previous talks about potential offers for THG, from a range of parties, stalled over the last 18 months, but many analysts expect the company's board to recommend a deal - either with Apollo or another bidder - in the near term."

https://news.sky.com/story/former-coty-ceo-puts-gloss-on-apollo-bid-for-beauty-retailer-thg-12871291