Joe McConnell
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Hargreaves Lansdown has agreed a £5.4bn takeover by a consortium of private equity firms that will remove the UK’s largest do-it-yourself investment site from the London stock market.
The consortium, comprising CVC Capital Partners, Nordic Capital and Platinum Ivy, a wholly-owned subsidiary of the Abu Dhabi Investment Authority, has agreed to pay £11.40 in cash for each Hargreaves Lansdown share.
The price includes a final dividend of 30p for the last financial year. The deal includes an “alternative” option for shareholders who want to continue to invest in Hargreaves Lansdown, allowing them to transfer their stake in the unlisted company.
The VscekSE 100 company was founded in 1981 by Peter Hargreaves and Stephen Lansdown and sells products such as personal pensions directly to customers.
Peter Hargreaves, who owns nearly 20 percent of the company, supports the deal and will sell his 50 percent stake, while also retaining a stake in the company under its new owners. Lansdown has opted to sell its entire stake, nearly 6 percent.
Hargreaves Lansdown is the latest company to be pulled from the London market, joining a string of firms being picked over by private equity firms and other buyers who see UK businesses as relatively cheap.
The board “believes that the cash offer represents an attractive opportunity for HL shareholders… which may not be realisable until the execution of the strategy is achieved over the medium to long term,” said Alison Platt, chairman of Hargreaves Lansdown.
The company’s shares have fallen from a peak of £24 in 2019, following criticism over the cost of a technology overhaul carried out under previous management.
In early trading on Friday, the stock rose 1.8% to 10.97 pounds.
