The Hut Group planning biggest UK IPO of 2020
Updated : 15:15
The Hut Group's boss may be in line to receive one of the biggest payouts in British corporate history from the company's upcoming initial public offering.
According to Mark Kleinman, the details of the long-standing share plan for chief executive Matthew Golding mean that he may be in line to receive up to £700m if the digital retailer can achieve a market capitalisation of £7.25bn by December 2022.
The details of the incentive scheme were set to be published later during the same week, alongside plans for the £4.5bn float - possibly as soon as Thursday - Kleinman said citing City sources.
Nonetheless, "insiders" had also pointed out to Kleinman that clinching that payout would require increasing the company's value by more than 30% in a relatively brief time span and in the face of Brexit and Covid-19.
One insider said that under the incentive plan the CEO's stake would not rise past 25%, implying that he might be awarded roughly 10% of the firm's equity, which at a total market value of £7.25bn would equate to £725m.
But the CEO would not be alone, with over 500 other employees of The Hut Group also owning shares and 200 also participating in the same share vesting scheme as Goulding.
That scheme had been put in place three years before to offset the dilution to Goulding's and others employees' stakes in the firm after early stage investors, Balderton Capital among them in 2010, injected money into the business.
Golding already owned a significant minority stake in the 7,000 person strong firm.
Cosmestics brands Christophe Robin, ESPA and Eyeko were among the brands owned by the outfit.
It was also a third-party logistics and infrastructure provider, powering global giants including Johnson&Johnson, Nestle, Procter&Gamble and Walgreens Boots Alliance through its technology platform THG Ingenuity.
Management was targeting 16 September as the date for the shares to begin trading.
The sale of between £500-900m new shares to institutional investors was set to be the biggest IPO of 2020 in the City.