In a significant development in the UK investment sector, Hargreaves Lansdown has accepted a takeover offer from a consortium including CVC Group, Nordic Capital, and Abu Dhabi’s sovereign wealth fund. The deal, valued at £5.4 billion ($6.9 billion), marks a substantial premium for shareholders of the U.K.’s largest stockbroker.
Under the agreement, Hargreaves Lansdown shareholders will receive 1,110 British pence per share plus a dividend of 30 pence per share. The offer represents a 54% premium over the stock’s closing price of 740 pence as of April 11, just before the consortium’s initial bid.
The consortium, which had previously made a £4.7 billion offer in May, cited the need for significant investment in technology and operational improvements to drive future growth. Hargreaves Lansdown’s shares saw a 2% rise in early trading following the announcement.
The investment firm has faced challenges in recent years, including regulatory changes, increasing market competition, and fluctuating interest rates. Despite these hurdles, Hargreaves Lansdown reported a 4% increase in both underlying profit before tax and revenue for the year ending June, reaching £456 million and £764.9 million respectively. However, net new business inflows declined by 13% to £4.2 billion.
Hargreaves Lansdown Chair Alison Platt described the takeover offer as an “attractive opportunity for HL Shareholders.” The consortium emphasized their commitment to accelerating the company’s transformation, focusing on enhancing technology infrastructure, digital channels, and overall service quality.
This takeover signals a new phase for Hargreaves Lansdown, with the consortium planning substantial investments to modernize the firm and strengthen its market position.
I am Aparna Sahu
Investment Specialist and Financial Writer
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