THG's Moulding to give up 'golden share' after share price plunges
British online retailer THG said it was removing founder and chief executive Matthew Moulding’s "golden share" and seek a premium listing after a slump in the company’s share price last week.
THG's shares plummeted by more than a third after an investor presentation was badly received. The company, formerly called The Hut Group, last week said no material new information was disclosed during the presentation and it knew of "no notifiable reason" for the price collapse.
Moulding's founder's share in the company gives him the right to veto a hostile takeover of the Manchester-based group.
THG, which went public in an initial public offering in September last year, also plans to move its listing to the premium segment of the London Stock Exchange in 2022.
The company said it would also carry out a further review of its corporate governance arrangements in line with its step up to a premium listing. Moulding is currently both chief executive and executive chairman.
"After the anniversary of our 2020 listing we feel that the time is right to make this next step and apply to the premium segment in 2022, thereby continuing the development of THG as we endeavour to deliver our strategy for the benefit of our shareholders, key stakeholders and employees," Moulding said in a statement.
Markets.com analyst Neil Wilson said the move "on the face of things should go a long way to fixing a key grievance that investors have had about the company".
"But we should note that this dual class structure was only ever going to last three years. Bringing forward the move by a year is not exactly sweeping reform. Nor is it a magic wand. Clearly governance concerns run much deeper than a quick bit of airbrushing can cope with."
"Following the disastrous capital markets day last week, there are obviously far deeper concerns about the state of the business and a lack of visibility over how different parts fit together. Shares rallied 7% before paring gains – a drop in the ocean compared with the gigantic falls in recent weeks."