The board of Hargreaves Lansdown today (9 August) recommended shareholders to accept a revised offer of 1,140p per Hargreaves Lansdown share in cash from a consortium of private equity investors that values the company at around £5.4bn.
The consortium, comprising CVC, Nordic Capital and an Abu Dhabi Investment Authority subsidiary Platinum Ivy, had previously offered 985p per share.
The LSE statement released this morning said: “The independent directors of Hargreaves Lansdown plc (“HL”) and the board of directors of Harp Bidco Limited ("Bidco”) are pleased to announce that they have reached agreement on the terms and conditions of a recommended final* cash acquisition by Bidco of the entire issued, and to be issued, ordinary share capital of HL.”
Since Hargreaves Lansdown shares were admitted to the London Stock Exchange in May 2007, its AUA has grown from £10.2bn to £155.3bn as at 30 June 2024.
The board’s recommendation is a major step towards taking Hargreaves Lansdown private, although the consortium will now need to secure the backing at at least 75% of shareholders to complete a deal.
Alison Platt (pictured), the chair of HL, said: "HL is on an important journey to transform the saving and investing experience for clients and make it easy to save and invest for a better future.
"While the Independent HL Board has been pleased with the progress made by the new management team, the Independent HL Board believes that the Cash Offer represents an attractive opportunity for HL Shareholders to realise an immediate and certain cash value for their investment at a level which may not be achievable until the execution of the strategy is delivered over the medium to longer term, and therefore intends to unanimously recommend HL Shareholders vote to approve it.
"We are pleased to see that the Consortium is aligned that HL has an important purpose making it easy for the UK consumer to save and invest for a better future."
Pev Hooper, managing partner at CVC Private Equity Group, Emil Anderson, partner at Nordic Capital Advisors and Hamad Shahwan Aldhaheri, executive director of the Private Equities Department at ADIA said: "HL has an important purpose: to make it easy for people to save and invest for a better future.
"Over the 40 years since it was founded, HL has built a strong, trusted brand, underpinned by high levels of customer loyalty and advocacy. As a consortium, we are aligned with management that, despite these strengths, the company now requires substantial investment in an extensive technology-led transformation to improve HL's proposition and resilience, and to drive the next phase of HL's growth and development.
"The Consortium brings extensive experience in supporting businesses undergoing transformation, and its members have long records of investing in regulated financial services companies to build better businesses and create better customer experiences.
We look forward to partnering with HL's management to accelerate its transformation plan - including investment in technology infrastructure, digital channels, and service enhancement - all with client value, service, speed of innovation, and HL's clear purpose at the core."
