LONDON – The Hut Group, owner of Espa and the beauty retail giant Lookfantastic.com, saw its shares surge on the first day of trading on the London Stock Exchange. In mid-morning trading, the stock bounced to 6.46 pounds, about 30 percent higher than its offer price of 5.00 pounds.
THG had announced plans for a stock market listing last month, and confirmed Wednesday it had raised 1.88 billion pounds in what has become the U.K.’s largest ever technology IPO, and the biggest stock market listing here for the past five years.
The Hug Group began conditional dealings for early institutional investors on the London Stock Exchange at 8:00 a.m. local time under the ticker THG, while trading on the main market of the London Stock Exchange is expected to begin on Sept. 21.
The offer price was 500 pence, or 5 pounds, per share, meaning the market capitalization was approximately 5.4 billion pounds at the start of conditional trading on Wednesday.
Matthew Moulding, founder, chief executive and chairman of THG said: “I am delighted that THG has received such strong support from some of the world’s largest investors, which means we have been able to achieve a highly successful offer of shares in the company.
“The results of the offer are a clear validation of our business model, significant growth prospects, and recognition of the hard work and talent of all our colleagues. Our flotation is the start of an exciting new phase in THG’s development and we look forward to sharing that journey with our new shareholders.”
The offer comprises 376,273,998 shares equating to a total offer size of 1.88 billion pounds, or approximately 35 percent of the company.
This includes 184,000,000 new shares to be issued, raising gross proceeds of 920 million pounds for the company. Some 192,273,998 existing shares are set be sold by certain existing shareholders, chiefly KKR, which had been an early investor in the group, raising gross proceeds of 961 million pounds.
In addition to owning and operating brands and retailers across beauty, wellness and fashion accessories, THG develops its own software in-house and operates websites and fulfillment for a variety of third party brands and retailers.
THG has an international infrastructure that includes digital content studios and event spaces, and in-house consultative and management services across trading, marketing and brand strategy.
In addition, it takes care of warehousing and fulfillment with the aim of operating and scaling retail brands. THG now operates more than 200 localized web sites and retails goods in 169 countries.
THG allows partner brands tap into its end-to-end, proprietary direct-to-consumer technology platform; its international fulfillment and payments infrastructure; and its hosting, translations, brand development and creative content services. Over the summer it announced that it was developing e-commerce sites for brands including Elemis, Burt’s Bees, Nuxe, By Terry and St. Tropez.
Nestlé, Procter & Gamble, Walgreens Boots Alliance, Johnson & Johnson and Nintendo among the clients that use its tech and e-commerce solutions.
In the year to Dec. 31, the group saw sales increase by 24 percent to 1.14 billion pounds, with 66 percent of sales generated internationally. More than half of THG’s sales come from its own brand products.