Britain’s biggest stock broker is on the brink of a £5.4 billion take-over by a consortium spearheaded by private equity firm CVC Capital and Abu Dhabi‘s wealth fund. Bosses at Hargreaves Lansdown have told investors they would “be willing to recommend” such a deal if the suitors lay down a firm offer.
The company said it follows three previous approaches from the consortium in recent months, including a £4.7 billion approach which was rejected in May.
On Tuesday, Hargreaves Lansdown confirmed it has received the latest non-binding proposal from the consortium, which includes Luxembourg-based private equity firm CVC, Nordic Capital and Platinum Ivy – a subsidiary of the Abu Dhabi Investment Authority.
The proposal values the FTSE 100 company at 1,140p per share, which includes a 30p annual dividend for investors.
A company statement said: “The revised proposal is subject to a number of pre-conditions, including completion of satisfactory due diligence and agreement of definitive transaction documentation.
“The board has confirmed to the consortium that the revised possible cash offer is at a value that the board would be willing to recommend unanimously to Hargreaves Lansdown shareholders, should a firm intention to make an offer…be announced.”
Regulators have now extended the deadline for the consortium to confirm if it will make a firm offer until July 19.
The statement added said: “There can be no certainty that any firm offer will be made for Hargreaves Lansdown, nor as to the terms on which any firm offer might be made.”
Shares in the company jumped 5.3 percent yesterday.
Hargreaves Lansdown is the latest London-listed company being lined up for a takeover, with low valuations proving attractive to overseas bidders.
Darktrace recently struck a deal to sell itself to US private equity firm Thomas Bravo for in excess of £4bn, while Anglo American recently resisted off a £39bn takeover bid from Australia’s BHP.
Hargreaves Lansdown has come under increasing pressure in recent years from lower-cost rivals including Vanguard, and shared have dipped by 41 percent since 2019.
Peter Hargreaves and Stephen Lansdown, who founded the company in 1981, have both sold stakes in recent years but still own about a quarter of the company.
Mr Hargreaves said: “If there’s a consensus for this to happen I will certainly consider backing it.
“A lot of people have the shares and are clearly elderly – they’ll be wanting to realise as much as they can with the business and probably don’t have to wait several years while it needs intensive care. And I think that’s better done in private hands.”
Mr Lansdown, who is also the majority shareholder in Bristol City FC, added: “It’s something to consider now and the board is going to support it so we’re going through the process.”
Express.co.uk has approached Hargreaves Lansdown for comment.
