Hargreaves Lansdown shareholders approve £5.4bn takeover deal

Hargreaves Lansdown shareholders have overwhelmingly approved the £5.4bn takeover of the investment firm by a private equity-led consortium.

Some 87 percent of the group’s investors voted in favor of the deal at Monday’s general meeting, while 13.4 percent voted against.

Once the sale is completed, investors will receive £11.40 in cash for each share they own, as well as a dividend of 30p per share.

Hargreaves co-founders Peter Hargreaves and Stephen Lansdown, who between them own around a quarter of the company’s shares, will receive £535 million and £309 million respectively.

The company agreed to be bought in August by a consortium consisting of CVC Capital Partners, Nordic Capital and Platinum Ivy, an affiliate of the Abu Dhabi Investment Authority sovereign wealth fund.

The trio initially submitted a £4.7bn bid in May, but Hargreaves’ board flatly rejected this bid as it said it undervalued the group.

After the new proposal was made, Stephen Lansdown, 72, questioned its price, telling The Times it was “not the best deal in the world”, although he accepted it would take the company “into another era where it can progress and grow.” .

Headquartered in Bristol, Hargreaves is the UK’s largest retail investment platform, with £155.3 billion of assets under management and almost 1.9 million clients as of June.

The company enjoyed significant expansion during the lockdown era, when many young Brits with extra cash tried retail investing for the first time.

However, growth began to slow as Covid-related restrictions eased and the Bank of England raised interest rates due to rising inflation.

Despite rising profits, Hargreaves was relegated to the FTSE 250 index last December after its share price fell by more than two-thirds from its pre-pandemic peak. In May it rose again to the FTSE 100.

The planned sale of Hargreaves comes amid a flurry of acquisition activity involving London-listed companies, which are often perceived as undervalued.

In recent months, cybersecurity giant Darktrace, Robinsons Squash maker Britvic, video game company Keywords Studios and packaging supplier DS Smith are just some of those that have agreed acquisition deals worth billions of dollars. pounds.

However, not all takeover deals have been successful: property website Rightmove rejected a £6.2bn bid from REA Group, whose majority shareholder is Rupert Murdoch’s News Corporation.

Hargreaves Lansdown Shares were broadly flat by mid-afternoon on Tuesday, up 0.1 per cent or 1p, to £10.87, well below their peak of £24.19 in May 2019.