Hut Group float is no triumph for London

Linda J. Dodson

A total of £1.9bn was raised – £920m for the company coffers and a further £960m to be shared among existing shareholders, including Moulding who pocketed £56m and has been left with a 25pc stake worth £1.6bn.

It also means that a controversial eye-watering bonus plan that promises to propel its founder further into the ranks of the super-rich already looks attainable. He stands to earn as much as £700m if Hut’s market value averages £7.25bn for more than 15 days between now and December 2022.

Meanwhile, the City has pipped Nasdaq in the battle to house one of Europe’s brightest technology prospects at a time when share sales are rarer than a face mask at a Trump rally.

But don’t mistake this for a triumph. In a recent interview, Moulding made it sound like he was doing us all a favour. “We have tried our best to ensure that we do list in the UK” – the rationale being that he would have had even more control over the business across the Atlantic.

Yet it’s not as if the entrepreneur has given up a great deal by selling shares here instead. Moulding will be chairman, chief executive, and landlord to boot, as well as retaining a “founder’s stake” that means he can bat away any hostile takeover bids.

In short, full control still, and a company that contravenes just about every City code going. There are those that argue it is a price worth paying, that it is worth turning a blind eye in a bid to woo the next generation of technology companies but that’s desperately short-sighted.

There is no point in the UK engaging in a race to the bottom. It’s a race with only one loser and it will ultimately harm London’s standing as it begins to resemble the corporate governance Wild West of Silicon Valley.

Source Article

Next Post

The most competitive property markets where bidding wars are pushing up prices

The mini-boom in the property market has sparked frenzied competitive bidding in Scottish and Northern hotspots. In some places, 66pc of sales agreed in August were subject to bids from at least three buyers, according to Hamptons International estate agents. In others, agents have reported homes selling for 40pc over […]

You May Like