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The Hut Group starts the new year with acquisitions

written by Bella Palmer
ipo

THG is using its new status to expand overseas through the acquisition of Dermstore.Com

The most successful UK IPO of 2020 is hitting the ground running in 2021. The Hut Group which runs a number of high-end e-commerce sites and brands listed on the London Stock Exchange in September 2020 in the largest UK IPO for seven years.

Since debut, the stock has risen in value and finished 2020 with a market cap around £6.80 billion making it theoretically large enough to qualify for inclusion in the FTSE 100 index, the benchmark that tracks the performance of the UK’s leading shares.

The Hut Group is using its new status to expand overseas through the acquisition of Dermstore.Com for £259 million from US retail chain giant Target. Dermstore specialises in online skincare and should sit in the “brands vertical” within The Hut Group structure, which already contains businesses in the beauty and nutrition spaces.

Indeed The Hut Group is also adding to its stable of nutritional brands with the purchase of two UK based suppliers David Berryman and Claremont Ingredients for which it’s paying a combined £60 million.

Hut Group founder Matthew Moulding is well versed in the world of online technology and retail having previously been at the now-defunct Phones4U, the mobile phone empire founded by Billionaire John Cauldwell. Hut Group’s CFO John Gallenmore is also another former Phones4U executive.

The Hut Group’s IPO was a feather in the cap for the London equity markets in a difficult year, although the company doesn’t meet the governance standards necessary for inclusion in the top flight of UK listed equities, as Matthew Moulding holds the roles of both Chairman and Chief Executive at the company, something that is increasingly frowned upon by ESG savvy investors who demand transparency and independence in the boardroom.

The Hut Group will publish its Q4 trading update on January 12th though it did provide some guidance in early December when it announced that it had been trading ahead of expectations during October and November.

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