Hargreaves Lansdown co-founder criticises ‘questionable’ £5bn private equity takeover

Hargreaves Lansdown’s co-founder has called the company’s £5.4bn takeover “questionable” and “not the best deal in the world”.

The investment platform became the latest London-listed company to be acquired by private equity earlier this month after rejecting its previous offers.

Directors accepted an offer of 1,140 pence per share from a consortium of investors including CVC and the Abu Dhabi sovereign wealth fund.

The offer represents a 54 per cent premium to its closing price of 740p on April 11, the day before the consortium initially approached Hargreaves, but still significantly lower than the 2,000p the shares were worth in 2019.

But Stephen Lansdown, who started the business in 1981 with Peter Hargreaves, has criticised the offer: “I think the board did the right thing in rejecting it initially. They put the price up.”

“It’s questionable whether that price is right, but it’s a fair price compared to what it was,” Lansdown told The Times.

‘It’s not the best deal in the world, but it takes the company into another era where it can progress and grow.

I’m happy with it. Am I exceptionally happy with it? Probably not. But it’s a good fit. It’s a good decision for the company.

His comments fuel claims that major British companies are being sold off at bargain prices.

Britvic shareholders yesterday voted in favour of a £3.3bn takeover of brewing giant Carlsberg and cybersecurity group Darktrace decided to back a £4.6bn takeover by US private equity firm Thoma Bravo.

The cash offer for Hargreaves Lansdown includes 1,110 pence per share plus a final dividend of 30 pence per share that the investment platform declared for its latest financial year, which ended June 30.

Hargreaves, 77, has agreed to sell half of his 10 per cent stake, which will net him 535 million pounds.

Lansdown, who turns 72 on Friday, will sell all his shares for cash, raising about £309m.

Both men have stepped back from the business in recent years, but Hargreaves has been a vocal critic.

Shareholders, including Hargreaves, have backed the offer, but it could be thwarted if a competing bid is submitted and recommended by the board.

The deal will also have to go through a shareholder vote and be approved by regulators.