THG founder Matthew Moulding has taken a stake in Kelso Group, the activist shareholder which has been highly critical of his leadership of the business.
In a corporate move reminiscent of the strategies employed by Mike Ashley, Moulding has acquired a 3.2% stake in Kelso, after the group called for a break-up of his listed beauty empire.
This makes Moulding one of Kelso’s top shareholders after making an investment of about £300,000.
Kelso launched back in 2022 to identify, engage and unlock trapped value in the UK stock market and completed a fundraising of £3m in January 2023 from around 20 UK entrepreneurs.
The business has been coined as a cash shell, backed by a number of high net worth individuals that was set up to stalk THG, and other undervalued listed businesses.
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Despite having a small small stake in THG, Kelso has become known for issuing bullish statements to investors regularly, claiming the company is undervalued and should be broken up.
At the start of the year Kelso upped its stake in THG and urged the board to go further with a series of actions to increase the value of the business, in particular the profile of its shares.
Following a visit to the Manchester and Warrington sites, Kelso has backed the board’s operational actions, but issued a four point plan to increase visibility and value in THG stock.
It also believes it should break off its nutrition brand MyProtein.
“We believe that THG’s nutrition division with its main brand of MyProtein should be valued as a global consumer brand, given its near $1bn sales, double-digit EBITDA margins and increased product innovation in the current year.
“This division alone continues, in our view, to be worth more than the market capitalisation of THG,” it said.
Since THG’s shares plummeted following the stock market float, Moulding has been highly critical a host of market players, which includes certain segments of the media, city institutions, and hedge funds.
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