UK investment firm Hargreaves Lansdown agrees to $6.9 billion takeover by CVC consortium

LONDON — British investment firm Hargreaves Lansdown said on Friday it had agreed to a takeover offer equivalent to £5.4 billion ($6.9 billion) by a group of investors including CVC Group.

Abu Dhabi’s sovereign wealth fund and private equity investor Nordic Capital are also part of the consortium, which said this offer was final.

Hargreaves Lansdown shareholders will get 1,110 British pence per share and a dividend of 30 pence per share under the deal, the company said. Its shares rose around 2% in early trading.

It comes after the investment platform in May rejected an offer from the consortium of £4.7 billion, or 985 pence per share. At the time, Hargreaves Lansdown said the bid “substantially” undervalued its offering.

Friday’s cash offer represents a premium of 54% to the share’s closing price of 740 pence on April 11 (the day before the group’s initial bid for the company).

Its shares jumped following the May offer after a tough few years which has seen the company battle with issues including regulatory changes, new incumbents in the market and the expectation of falling interest rates.

In September 2023, the investment platform — whose rivals include Interactive Investor and AJ Bell — outlined a new strategy including a renewed focus on clients, speeding up innovation, and implementing savings measures.

The company on Friday reported earnings for the year to the end of June, with underlying profit before tax up 4% at £456 million and revenue also up 4% at £764.9 million. Net new business inflows fell 13%, however, coming in at £4.2 billion.

Hargreaves Landsdown Chair Alison Platt said in a statement on Friday that the consortium’s offer “represents an attractive opportunity for HL Shareholders.”

Meanwhile, representatives from CVC Private Equity Group, Nordic Capital Advisors and the Abu Dhabi Investment Authority said Hargreaves Landsdown “requires substantial investment in an extensive technology-led transformation to improve HL’s proposition and resilience, and to drive the next phase of HL’s growth and development.”

“We look forward to partnering with HL’s management to accelerate its transformation plan – including investment in technology infrastructure, digital channels, and service enhancement – all with client value, service, speed of innovation, and HL’s clear purpose at the core,” they added.

This is a breaking news story. Please refresh for updates.