THG mulls demerger of tech platform
Retailer THG is weighing up a demerger of its fast-growing technology platform Ingenuity, Sky News learns
The move, which could value Ingenuity at up to £5bn, would create a separate publicly listed company focused on providing e-commerce services to third-party clients
The development represents a significant strategic shift for THG, which was founded as a beauty e-retailer but has expanded rapidly in recent years through acquisitions.
It follows a period of sustained growth for Ingenuity, which provides e-commerce, data and digital marketing services to a host of brands, including Nestle, Unilever, and Coca-Cola.
In the first half of 2023, Ingenuity's revenue increased by 67% to £100m, and its adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) rose by 140% to £28.3m.
Sources close to THG said that the company was in the early stages of considering a demerger of Ingenuity and that no decision had yet been made.
However, they added that such a move would allow THG to focus on its core retail operations and unlock the value of Ingenuity, which has been a key driver of its recent growth.
Analysts have suggested that Ingenuity could be worth as much as £5bn as a separate company, which would give THG a significant war chest to invest in its retail business or make further acquisitions.
THG declined to comment on the speculation.
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