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Can’t think that the staff are too impressed with payment in THG shares, a devaluing currency.

Very good call Yorek. A ready made and well known nutrition brand just waiting for better management.

Just checking I’ve got this right. Ingenuity is being valued at £100m maximum (might be less if THG share price is below 49pence at the time of the demerger). But THG is putting £75m cash into Ingenuity so this means it’s actually being sold off for £25m. Pretty good deal for those shareholders who decide to roll into it, chiefly you know who.

Traintracks it’s like I said on another post. The whole BoD seems to have absolutely no shame or take any sort of responsibility for their massive destruction of shareholder value. They seem to live in some sort of parallel universe. At the very least you’d expect them to acknowledge what’s happened even if they refuse to take any responsibility for it. There’s never even a mention of the loss in value they have presided over, far less any sort of remorse or responsibility taking. A complete disgraceful shambles. Lord Allen should be thoroughly ashamed. Does he even care about his own reputation or is he happy to sell it for £500k a year. It’s a lot of money for most of us but probably not a fortune for him.

And I’ve yet to hear the Board acknowledge this or show any empathy with shareholders or even an apology or contrition or a reflection on lessons learned or things they could have done differently/better. It’s all rather bizarre.

1pencil it’s a recent article. Primarybid was the mechanism used by retail shareholders in the 49p placing, although of course the poor retail shareholders had to bid for their shares ‘blind’ as they didn’t have any guidance as to the actual placing price.

Matt has pulled the emergency cord. There’ll be a delay whilst this is investigated. THG rail apologises for any inconvenience caused.

Kua don’t be giving him ideas.

The supposed Ingenuity value of £100m includes £75m of THG cash that is being given to it. So in effect THG is giving Ingenuity away for £25m. Bear that in mind when you’re deciding whether you want to swap your Newco entitlement for a few more Remainco shares.

I’m pretty sure they’ll just be added to your ISA. If you chose to take the Newco shares though they will have to be held outside an ISA as others have said.

There really isn’t much risk as the choice is to virtually give it away now or to roll a very small stake into a private entity. I agree with you that there are significant inherent risks in investing in private companies but the value of your investment in Newco will be pretty negligible given how few additional Remainco shares you are going to be given in return for giving up your Newco shares.

To answer the original question the £10m Frasers investment is in THG. They will be entitled to take their pro rata share in Ingenuity or to apply to exchange their Remainco shares for additional Newco shares. With a £10m investment in THG their pro rata entitlement will be around 1.5% as this is their % holding in THG.

@samb69 I respect your reasoning. All I would say is that the valuation of Ingenuity is so low that you’re not taking much of a risk to take your shares rather than essentially give it away for free. It’s a near free option.

If it is I’ll be voting against the stitch up.

I’ll be taking my ingenuity shares even though I’ll have to hold them outside my ISA and therefore any future upside will be heavily taxed through CGT. My concern going forward would be around further placings to Matt and his mates in order to dilute the value of the company owned by private investors. It’s hobsons choice. I either let him take my fair share of Ingenuity on the cheap now or I risk him taking it later. Btw the £100m valuation is in practice £25m as THG is putting £75m cash into Newco. Shocking that he can legally get away with all this.

I’m amazed that so many people (95% of those who voted) voted for the AGM resolution that allowed the directors to set aside the shareholders pre emption rights. I always vote against this - why would I want to give up my legal protections against dilution.

You can take your pro rata share of ingenuity regardless of the fake valuation. The valuation only comes into play if you want to take more or fewer Ingenuity shares than you are pro rata entitled to. It’s a mechanism for determining how many remainco shares you will have to give up in order to get more newco shares and vice versa, and is designed to favour those choosing to take more newco shares as cheaply as possible, ie Matt and his mates want your newco shares. It’s as simple as that I’m afraid.

It favours those wanting to get control of Ingenuity as cheaply as possible.

Well said Ephemeral. This all needs to be kept in perspective.

Just a pity we can’t keep the unquoted ingenuity shares in an ISA wrapper. Means paying probably (post budget) 40% capital gains tax on any future upside. A bit galling.