Investor blow

Hunter punt THG loses third of value as shares fall

Tom Hunter at Scottish Edge

Early investor: Sir Tom Hunter

Shareholders in online retailer THG, whose early backers included Sir Tom Hunter, saw the value of their holdings plummet by more than a third after the former stock market favourite raised concerns over its strategy.

Shares in the company, formerly The Hut Group, fell 34.75% on Tuesday from Monday’s closing price of 437p, to close at 285p, wiping £1.85 billion from its value to leave it worth £3.48bn.

Among the firm’s early investors was Sir Tom Hunter, who took a 3.75% pre-flotation stake in the business. As of last December, when his accounts were published, he held a 1.96% stake, valued at the time at £130m. He planned to transfer profits to his charitable causes.

He sold more shares in January, leaving him with 14.8 million worth £113 million. His current shareholding was not disclosed, though according to data and news service Reuters, he holds 1.22%, or 14.85 million shares valued at approximately £41m at today’s closing price of 276.6p.

Other backers included former Tesco boss Sir Terry Leahy, ex-Debenhams chief executive Terry Green and entrepreneur Oliver Cookson.

The Manchester-based e-commerce company floated last September at 500p a share as it drew an army of supporters and claimed to have made more millionaires on its payroll than any company in UK history. Founder Matt Moulding, who set up the business in 2004 selling tax-free CDs online,  became an instant billionaire on the flotation.

But it has tumbled since announcing results for the first half and announced plans to split off its Ingenuity technology division from its beauty and nutrition divisions.

The company held its first capital markets day yesterday to brief shareholders.

Reports that Japanese bank Softbank had informed the company it would not exercise an option to invest further in its tech business have been denied and that it was on track to do so in the first half of next year.

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