Member Info for Hosai

"From 2008 to May 2015, Lord Allen served as a Senior Advisor to Goldman Sachs, advising the firm’s private equity portfolio and banking business."

Didn't this get to around 72p intraday before it shot up on the Apollo news? A lot of ppl using 64p as pre-bid figure. 100% would be 144p. Sparta said they thought even 100% premium would be rejected.

This is true but even if you gave it 20 for the dodgy accounting (which hopefully is behind us with the new set of directors), 10 for the US/UK difference (which seems quite a lot) 1 for the net debt/cash difference, 5 for the EBITDA difference, 1 for ELF having double the instagram followers and another 1 for their better revenue growth last year. That would explain 37 of the multiple.
So you'd still have a 49x the multiple left (86-37). Obv Elf is likely a little over-valued but clearly potential great value here.

*£21 million net debt

Good post Bearhunter, ELF do have $25 million net cash, versus Rev B £21 million debt though obv that can in no way explain a 86 times valuation difference but perhaps the £40 million odd difference explains 1 out of the 86x multiples lol.

Not sure why it matters dpws, how could this info of number of shares this forum holds be used against us even if it was somehow for sinister purposes?
Equally not sure it can be that much use. Even if we have more than Kelso we clearly can't raise more money the way Kelso can. Plus they are individuals with a lot more connections etc hence the media regularly reporting their views.
However as others have said I think the reason ppl replied to this thread was more just out of curiosity etc, there's no harm in it.

Not just PIs, there will be big players who don't want to go private who they would have to appease with the deal. Also it's hard to say "£1.70 significantly undervalues the company" and then buy it out less than a year later for less.
The macro has improved since then, inflation now down to 5% in USA, most expect it to fall a lot further as the year progresses due to the huge fall in energy prices.

That period when in went down each day from 158p last time there were fairly regular articles questioning the validity of the bids. They were emphasizing that Matt M knew Candy and obv that Belerion bid was led by a THG non-executive director. There was a lot of hinting that Matt M may have been in cahoots with them. It was actually only after they both ruled themselves out as THG had not opened the books to them that sunday times did a piece saying Candys approach may have been more legit than many had thought, however obv THG were not interested.
Atm there seems to be less press scepticism around this Apollo approach and with the golden share expiring in less than 5 months Matt M has a lot more incentive to act if he fears losing control.

I suppose there is so leeway in a sense to declaring an asset to be impaired which was a bulk of the loss. For example they could argue Cult Beauty's valued is impaired as sales may have slowed down or margin got worse. However they might equally argue in a couple of years we will be back to where we were a few years ago and something like Cult Beauty would be valued at 2-3x sales again meaning it shouldn't be impaired.
So in a sense there is some accounting judgement as the definition of a non-current asset leaves some leeway.

As mentioned before Phil Noblet who is head of UK/Ireland investment banking for Jefferies is the broker for the Apollo approach (he also was for the Belerion bid). He was known as HSBC's top deal marker - https://iclg.com/ibr/articles/8486-hsbc-top-uk-deal-maker-departs-for-jefferies
Was ranked 6th biggest UK dealmaker in 2021 - https://www.cityam.com/exclusive-new-data-reveals-the-top-10-dealmakers-of-2021/

He also has been a joint broker for Boohoo with Jon Goold of Kelso - https://www.boohooplc.com/sites/boohoo-corp/files/all-documents/result-centre/2021/trading-update-q1-fy22.pdf

This doesn't necc mean that much but clearly they must be acquainted.

Agree Anacott though in terms of those article the 60% EBITDA margin quoted by RBC is now forecast by THG as to be 7.5% margin so clearly atm it's hard to argue ingenuity is thus far a disappointment.
However in terms of the SOTP and Nutrition and Beauty this is still very undervalued, I would say each division on their own cover the current market cap as Kelso have alluded to.

"which is said to be working on the potential bid with advisers from investment bank RBC, already owns a chunk of its debt."

Nice to see a little more details around it, clearly it's not just hot air. Tbf the times called it right when they reported that Kelso were "going to go public soon". Think their letter was a week or so after that.

Ephemeral if Apollo wait 6 months they risk a macro rise in all growth/online/tech shares due to falling inflation. They are under pressure from their own investors to take advantage of downbeaten stocks, UK stocks are especially downbeat.

I agree, also once a stock is above 100% up it feels like it can go to any amount such as 500% as it becomes a crazy day.
Ultimately I'd be amazed if it wasn't above 100% up considering that would only be 38p

107k for me, average around £1.75, I do miss feeling more wealthy.
Family has another 20k so 127k total.

I did have more like 125k but have done some bad trades in last 6 months, I think I'm too attached to THG which is bad for trading coz if I trade 10% I'm convinced it's about to go up significantly and buy back if it goes against me. That's why I'm partly hoping for MBO so I can become a good detached trader again lol.

Just noticed the city spy is followed on twitter by Ben Harrington i.e Betaville

Golden I take your point on the debt already being in the EV I realized after I posted. But was doing more calcs and still think its a good comparison to show nutrition undervalued:

For 2022 Bullring increased revenues 10% to $1.37 billion and made a 24% EBITDA margin after making 18% EBITDA in 2021 (18-20% is medium term aim).
However their debt has gone from $597 million debt end of year 2021 to $944 million debt end of year 2022. Their cash reduced from $152,600 to $35.8 million. Therefore net debt increased by $463 million whereas THG net debt increased by £210 million.
Converting dollars to pounds Bellring made £166.72 million more EBITDA than Nutrition but increased net debt by £162 million more than THG.

For 2022 Bellring only generated $21 million operating cash flow whereas Thg generated £37 million operating cash flow.

Therefore for all their better margin and seemingly better income sheet performance Bellring have taken a bigger hit on the balance sheet and in operating cash flow.
At the moment their market cap is $4.78 billion so 3.47x revenue. Where would it be without that balance sheet issue? Prob about $6-7 billion? $6.5 billion would put them at 4.74x revenue.
THG nutrition made £675 million revs in FY2022. It's prob valued at £575 million if we say it's half the current THG market cap so 0.85x revenue.

Clearly Bellring have the better margin (though nutrition at-least made 12% in 2021 and should again now with new automated warehouse etc) however all things considered with Bellrings worse balance sheet and cash flow and the fact that Nutrition has tax losses to bring forward for a fair while I'd say Nutrition should be atleast 3x revenue when compared here.
3x 675m = £2,025 billion or 155p.

I believe Beauty at 1x sales should give another £1.3 billion or around a £1 to sp. So £2.55 for both.

Some fair points golden though I do feel you keep talking like THG should be judged completely on one bad year where perhaps they chose wrong with pricing decisions and could have kept better margin.
For example in FY2021 Nutrition had 12% EBITDA margin whereas Bellring had EBITDA 18.7%. Atm Bellring around 27% so clearly winning but I doubt this disparity would last forever, it wouldn't make sense. THG nutrition being mostly online hurt it in 2021 but they are changing that now a little.
Also worth noting Belring have $944.8 million debt and just $43.9 million cash. So $900 million net debt, compared to THG £180 million. This will obv be surpressing Belrings sp (despite their good margins) and is also is obv going to be revevant in the enterprise value/sales comparison Kelso made as without this debt their EV/sales would be a lot higher than
Celsius is a bit different as a drinks company but have around 10% EBITDA margin, they did have 100% revenue growth last year though would have doubts this can be maintained and they have no debt. Their revenue at $653 million, EBITDA $71.1 million and market cap $7 billion. Does seem interesting them being at 10.8x EV/sales whereas nutrition I imagine is around 0.7x Ev/sales?
Therefore I'd still say it's a fair point that THG Nutrition on the balance should at the very least be 3x EV to sales - around £2.1 billion or 163p share price for nutrition.
I would make similar arguments for Beauty, you can't judge it on one bad year and decide that means it will never return to the margins it frequently used to get. 1x sales or £1.3 billion odd doesn't seem a stretch which would add around £1 to sp.

Technically speaking if you went along the Kelso logic of Celscius and Bellring EV/sales. And gave THG Nutrition Bellrings EV/sales of 3.9x (Celsius is 10.8x but they have twice nutritions margin whereas Bellring is similar) would put THG Nutrition alone around £2.7 billion (or 210p).
Beauty at 1x 2022 sales adds another £1.235billion so the total for the two would be £3.94 billion or £3.03.
That's ignoring Ingenuity commerce and the tax losses they can bring forward, also using the higher THG market cap given online which I presume is the correct one.

As much as people go on about the Steves, is there anyone crazier than one_frankel on advfn? lol