It was near impossible last year to peruse the financial news without seeing headlines celebrating the exploits of The Hut Group, the Manchester-based e-commerce conglomerate which went public in a £5.4 billion floatation in September 2020.

All was well for a while until last week when the hut group (THG) execs held a shareholder meeting in which Moulding updated investors on the company’s software and logistics arm Ingenuity. Whatever they heard, investors weren’t happy; after the meeting, THG shares collapsed, wiping about £2bn off the company’s market value.

The company issued an immediate response “THG notes the fall in the share price yesterday following the capital market event, and confirms that it knows of no notifiable reason for the material share price movement, and that no material new information was disclosed at the event.”

Meanwhile, there are concerns that SoftBank, one of THG’s main investors is looking to withdraw its support. SoftBank was an early investor in an option to invest £900m within 15 months to take a near 20% stake in Ingenuity, putting a £4.5bn valuation on the tech arm. But, according to a report from 

, THG’s tech arm’s prospects aren’t looking so rosy – perhaps echoing the thoughts of SoftBank’s board members. Clearly, losing SoftBank would mean losing a key financial support structure, as well as a blow to confidence in the group.

Either way, the fallout from the share free fall is (for now) that THG’s founder Matthew Moulding announcing he will give up his golden share (one person or entity has control of at least 51% of the voting rights) of the company this week in an attempt to regain the confidence of the City. Shares in THG jumped by 8 percent following the news but shares were still more than 50 percent lower than in September with THG’s total market value now close to £3.5bn.

Based in Manchester, the online retailer and tech services company owns sports nutrition brand Myprotein, online retail sites Lookfantastic, Glossybox, Zavvi and beauty brands including ESPA and Illamasqua. To date, it has revealed little about the profitability of its divisions, but did reveal it plans to separate its technology arm from its beauty concerns – an announcement which preceded the devaluation and may have played into it.

Despite the shaky last few weeks, THG is hoping cancelling Moulding’s controlling share might be enough to steady the ship or at least promote “good corporate governance”.

Moulding’s controlling share was meant to give him control of THG for three years. However, the removal of its dual-class share structure will most likely boost the faith of investors who have seen their shares plummet in value.

“After the anniversary of our 2020 listing we feel that the time is right to make this next step and apply to the premium segment in 2022, thereby continuing the development of THG as we endeavour to deliver our strategy for the benefit of our shareholders, key stakeholders and employees,” Moulding said.

Should the move not be enough, this could mark the beginning of the end for what was heralded as a true British unicorn. Just last year, when many businesses were struggling to stay afloat, THC constructed a £750 million headquarters near to Manchester airport to house some of its 7,000 staff. And, during lockdown it purchased two cargo planes for a reputed £80 million to ensure it could still ship goods, taking advantage of the lockdown-enforced trend for online shopping.

“It has been a year of significant progress across the Group,” Moulding said at the time. “We have continued to make huge investments to develop our infrastructure, technology, brands and people…THG has an excellent platform for growth with an outstanding portfolio of prestigious brands.”

Moulding and John Gallemore founded THC with £500,000 in savings in 2004. Originally the company took advantage of a tax loop to sell CDs and DVDs to the UK from the Channel Islands before moving into online retail with the rise of the internet.

Inevitably, the group soon came into competition with Amazon. Instead of rolling over, Moulding and Gallemore decided to diversify by acquiring a number of niche websites, mostly in the fitness sector. The move was a savvy one, attracting investors such as former Tesco CEO Sir Terry Leahy and former Marks & Spencer executive chairman Sir Stuart Rose in the first three years.

As THC’s reputation grew, so too did its valuation; growing from £80 million in 2010 to secure a £1.14 in 2019. Speaking to the 

 that same year, Moulding claimed the group owned a network of 200 websites, operating across 40 currencies and in 60 languages worldwide.

Meanwhile, it’s e-commerce services division, 

 has been at the forefront of revolutionising how businesses and retailers interact with their customers and supply chain. Last year THG announced a ten year, multi-million pound deal to digitally transform Homebase, a company which has been the subject of speculation around its future for a number of years. This was to be just the start for Ingenuity, but to date it has not been a high earner for THG.

Talismanic founder Matt Moulding. Put out to pasture?


Moulding had been full of optimism for the future in quotes around THG’s IPO last year, but not everyone was so certain of the group’s success, with many corners asking if the group had indeed over extended itself; following the news of the group’s floatation, 

 published an opinion piece asking ‘Is Hut Group’s vaulting ambition a leap too far in cutthroat online market?’

“A market capitalisation of £4.5bn is enormous for a company of The Hut Group’s relative immaturity,” wrote the author, adding that the figure should “cause a sharp intake of breath”.

One issue commentators are pointing to is THG’s need to employ a an experienced non-executive chairman as Moulding is currently both chief executive and executive chairman. Then, of course, there is the fact that THG simply isn’t making money; the firm generated £1.6bn turnover in the year to the end of March but made a pre-tax loss of £534.6m. In other words, THG needs to start making money, and soon.

Moulding’s decision to forgo a personal payout for the greater good might save the day. And it isn’t the first time he has cut his own earnings for the good of the group, either. He has given up about £76m of his shares previously to help fund the acquisition of a string of properties including distribution centres and offices and now charges THG group £19m a year in rent, which he donates to charity. Whether Moulding’s charitable sacrifice is enough to save the company this time around remains to be seen.

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