THG has successfully raised £95.4 million to fund the spin-off of its tech division, Ingenuity, exceeding its initial target of £75 million.
- CEO Matthew Moulding personally invested £10 million, with strong support from existing and new investors, including Frasers Group.
- The equity raise aims to simplify THG’s business as a profitable global consumer beauty and nutrition company.
- The Ingenuity division will transition to a private entity, while THG PLC remains publicly listed on the stock exchange.
- The group’s third-quarter revenue shows mixed results, with reported increases in Beauty and Ingenuity sectors but a decline in Nutrition.
THG, in a decisive financial move, has raised £95.4 million to support the separation of its Ingenuity tech division. This strategic initiative exceeded its initial fundraising target of £75 million, showcasing substantial investor confidence, including a notable £10 million contribution from THG’s CEO, Matthew Moulding. Among the enthusiastic investors is the Frasers Group, which has not only committed £10 million but also established a multi-year strategic partnership with THG.
The push to demerge Ingenuity reflects a strategic effort to streamline THG into a cash-generative entity within the global beauty and nutrition markets. This development marks Ingenuity’s transition into a private company, while THG PLC’s publicly listed status remains unchanged. According to THG, the demerger is designed to enhance the business model by improving financial metrics such as balance sheet health, capital expenditure, and cash flow.
In recent financial disclosures, THG reported a positive trajectory in its Beauty and Ingenuity divisions, with revenue increases of 2.3% and 15% respectively compared to the previous year. However, the Nutrition sector faced a decline of 13.1%, despite a recovery in monthly sales since July culminating in September achieving the highest figures for the year.
CEO Matthew Moulding, reflecting on the company’s performance, noted, “It was especially pleasing to see another solid quarter of delivery from both our Beauty and Ingenuity businesses, rewarding the significant overhaul of their respective operating models during 2022 and 2023.” The CEO highlighted the completion of a major rebranding effort and expressed pride in the company’s sustainability achievements, recognising THG as one of the top 250 companies globally for its sustainability initiatives.
Preparations for the upcoming peak trading period are well underway, with THG enhancing efficiencies across its network over the past year. This effort is expected to deliver further benefits to Ingenuity clients and bolster new customer acquisition strategies.
THG’s financial manoeuvre and strategic shifts aim to refine its business operations and strengthen its market position, setting the stage for future growth.
