🚀 Shareholders approve spin-off
On December 30, 2024, THG shareholders voted to divest its Ingenuity ecommerce platform, with 89% of investors in favor. Ingenuity, valued at £90M ($109M), will operate as a private entity with no public listing. THG owns popular brands like LookFantastic and MyProtein, which are now free to focus on beauty and nutrition. This decision aligns with THG’s plan to streamline operations and boost cash flow.
📉 Ingenuity’s financial struggles
Ingenuity has faced challenges, narrowing losses from £227.6M to £140.9M ($172M) in the year to June 30, 2024. Despite the improvement, sales fell 5% to £671.4M ($813M). The company provides ecommerce tech for retailers like The Range and Holland & Barrett and operates 13 warehouses across the UK. With 3,500 employees, it has been struggling to achieve profitability.
💰 Funding to support operations
THG raised £95.4M ($115M) in a funding round and secured £55M ($66M) in debt funding to sustain Ingenuity. This financial cushion aims to support the platform until it becomes profitable. The split is expected to simplify THG’s business model, focusing on its core consumer, beauty, and nutrition segments while improving cash flow and reducing capital expenditure.
📦 Future of Ingenuity
The decision to spin off Ingenuity reflects the board’s confidence in its long-term value. THG highlighted the opportunity to streamline its focus and strengthen its balance sheet. For Ingenuity, the challenge will be to leverage its technology and warehouse network to deliver growth. Investors will be watching how this new chapter unfolds as the company pivots to recovery and profitability.
Will Ingenuity’s spin-off turn its fortunes around?
