Member Info for Okehurst1

WPP look like they are going to outsource the management of a clients product /storage and management via fulfilment centres including robotics / last mile delivery whilst WPP will build them the web site and take photographs - that’s not a sustainable business model

Ingenuity once demerged will certainly be a target for a takeover

‘WPP’s comparative weakness, however, is its lack of fulfilment infrastructure. THG through 2021 added six new warehouses to its network globally, taking the total to 18.

“We are unique at the moment as an e-commerce business in that we’ve got substantial surplus capacity in fulfilment,” THG CFO John Gallemore told investors last week.

It has more than 200 last-mile courier players in its system. WPP, by comparison, will “partner with logistics companies to provide the warehouses and delivery of products” it tells The Grocer. THG also has a strategic partnership with Ocado’s robotic grid rival AutoStore – automation tech that can’t be quickly rolled out’

Not a week goes by without the U.K. press having a pop at MM, he has already admitted he hasn’t enjoyed going public, why bother growing owning 20% within a public company when he may be able to own 30% to 50% - as a figure - owning a private company.

Within reason he can pay himself what he wants, can make long term plans and he’s not answerable to anyone other than Bond holders ?

With Bond Holders it’s then all about the covenant on the Bond - barring the coupon value - if he negotiates hard he should get himself a decent deal on the funding alongside PE partners which he already has on his share register already.

Personally I hope he remains quoted and I can ride the opportunity at these levels but I am starting to sway towards the strong possibility THG is going back to private one way or the other, but at what £market cap?

It was a ‘ private ‘ exchange of messages

Gist indicated something happening this May, contact was unsure of detail but stuff about to happen

Hope it’s sale of a division, Ingenuity spin off , full listing

Gut feel is moving towards THG being taken Private, it’s just what price?

The ‘ red dot’ RNS is popping up any day now by the looks of things

Pinch of salt but City Spy latest Tweet

https://twitter.com/thecityspy/status/1521014198398078979?s=10&t=ShAI_thgUTEl-8DRWI1meQ

The red dot news could happen any day, what price would we see on open? Buyout or disposal of an asset / break up of group

With 1.4M shares in issue, what price would MM have to offer to secure that he pulls off a Management Buy Out and avoids a counter higher bidder from PE ? -suggest this has to be his biggest concern, PE enters a bidding war as he puts THG into play

As such, suggest his opening offer has to be a good one, the Press are muting £2.75, valuing THG m/cap at £3.85B

IF he does go down the Private route will he put a 3 in front of the offer?
£4.5B ?

Personally I would prefer he sells Nutrition, repays debt, full listing of Beauty that would have £1B cash war chest and he Direct Lists Ingenuity onto Nasdaq using remaining funds from disposal and SoftBank top up.

If it is a Buy Out suggest it’s coming very soon - any day but by end of June latest as per Chairman’s statement indicating a restructuring of the Group

What’s your call Pencil ?

Citi closed a chunk of their short today ?

Spike up this morning was to attract sellers out ?

Oxford, could be right and we are heading for MBO

Kim
They couldn’t buy in open market today and then offer to buy out the balance of shares - it would be illegal, can only imagine the barrage of legal claims especially USA holders

The fact they are not buying in the market and fending off multiple approaches ? The BoD have an agenda

With Directors not buying shares in the market and the noise of multiple PE bids being rebuffed away as not high enough, is it starting to look like a MM takes private is the end game for us PI’s?

Smoke out PE, suss the highest bid … MM trumps and then discloses the nearest highest price and that his offer is the best ?
His only exposure is PE up the anty after that point but he must have a price he would take for the group

He’s on a win win

Feels that way Farrell, especially for bigger brands

Holy, good point

As per the Chairman’s statement in last weeks RNS, the business is undergoing a restructuring alongside multiple 3rd parties bidding for the business, not too sure the Directors can buy at the moment, the longer it goes without insider buying the more it looks we could see a management buy out / offer

Personal opinion, the BoD are currently teasing out best bids so they have the option to trump, suggest their advisors are advising them they can’t buy in the market

Amazon and THG have differing business models within e commerce

Amazon relies on 3rd party merchants to sell through them with no relationship between the merchants and their end customer.

THG is a D2C model which actually cuts out Amazon for the Merchant allowing to build a relationship with the customer, the model is particularly attractive to Brands - as we are seeing with Ingenuity

Separately THG produces many of its core products for its Beauty division - Bentley labs for example

Saying all that …. Amazon online net sales still hit $51.13B vs Est $51.5B

Steve, not sure it matters unless trading in and out - not saying your are btw

Suggest it’s a Hold at the moment, the red dot could pop up any time
with news on the breakup / buy out

Let’s not forget they only own £37k of shares between the whole BoD

Suggest the BoD are working on their corporate agenda which is intertwined with their personal financial goals

Can only speculate but it has to be a restructure ?

FT is going to do £9M this year ? They could generate £5M gross
Plc costs £1M

Something on the go … they need to bin CD4 first, get rid of that and there is a profitable business here

The bit I like

‘ respect; treat others like we would ‘

Good point Ste, no idea but it’s good news for anyone Long in a perverse way as the price may well over shoot on breaking news

Think we can say THG a is in play - of sorts - not IF just when m

Reckon the THG BoD are just teasing out the best price from PE, they can then trump knowing the market appetite - they can calculate will a PE bidder outbid

Management buyout to private or sell a division, personal opinion this is where we are going

Agree on the Macro Fred, fair comment.

THG as an investment is currently cut away from THG fundamentals linked to world inflation etc

This is a straight forward play on who pays the most to take THG private, PE or MM …. Or pays the price for Nutrition or Beauty

One of the above is going to happen

It feels like MM is teasing out the highest Bid for the group and / or a division, gut feel … nutrition

He can then look at the highest Bid and make his own opening gambit to trump or sell a division or take the full buy out