THG chief executive Matthew Moulding has dropped a pledge of shares in the business as collateral against a personal loan with Barclays, in the latest effort to claw back investor confidence after a bleak share price crash.
The company today said that Moulding and his wife Jodie were no longer using THG shares as collateral against a £100m loan from Barclays, and that no stock owned by either the individuals or the holding company was part of a share pledge any longer.
THG said that the Mouldings had sold no shares as part of the change, but no details were provided as to what alternative collateral would now back the loan, understood to be ongoing.
It comes after THG revealed in late September that a shell company that Moulding controlled, called FIC Shareco, had agreed the loan from Barclays by securing it against around 182m THG shares.
Moulding held 28m of the shares, his wife Jodie held 9.8m, and FIC Shareco held 144m. Part of the loan had been used to buy more shares in THG.
Now that Moulding has dropped the pledge, it removes the prospect of any THG shares being sold to Barclays if he defaults on the loan.
Shares in THG rose 1.9 per cent to 331.6p this morning on the news.
It comes just a few days after THG announced Moulding would surrender his controversial “golden share” in the company, which gave him the right to veto any hostile takeover bid in the next three years.
It’s the latest effort to establish some more distance between the co-founder and the business and get investors back on side, after shares in the UK e-commerce business, which owns brands such as Lookfantastic and Zavvi, nosedived as much as 36 per cent last week when investors were left disappointed by a “capital markets day” meeting Moulding held.
Although the presentation had been organised in an attempt to put the record straight on the company’s strategy and explain the valuation of the group’s white label business THG Ingenuity, Moulding’s attack on short sellers during the meeting had the opposite effect.
Despite the moves to relinquish some of Moulding’s hold on company shares, investors’ main concern over THG’s lack of transparency around the profitability of its Ingenuity arm, which builds e-commerce platforms for consumer goods groups.