The Hut Group, the online consumer goods retailer which has become one of Britain’s biggest technology success stories, is courting global investors about a share sale that could lead to a bumper flotation.
Sky News has learnt that the Manchester-based company is talking to a string of blue-chip investors including a Singaporean sovereign wealth fund, Baillie Gifford, Capital Research Group, Dragoneer Investments and TSG Consumer Partners about a deal that would value it at well over £4bn.
City sources said The Hut Group’s board had yet to formally decide whether the fundraising, which would amount to hundreds of millions of pounds, would be conducted in the public or private markets.
The institutions with which the company has spoken in recent weeks are understood to be open to buying shares either privately or through an initial public offering (IPO).
A large share sale by The Hut Group would enable some of its early investors, such as the private equity firm KKR and venture capital backer Balderton Capital, to offload their stakes at a massive premium.
In total, roughly 15pc of the company’s shares are expected to be placed with new investors in the next few months.
In addition, the company is likely to raise a substantial sum from the sale of new shares.
The company already counts the world’s biggest asset manager, Blackrock, among its shareholders.
On previous occasions it has opted to raise money without listing its shares on a public exchange, using such fundraisings to refresh its private investor base.
Bankers at Citi and JP Morgan are working with the company on its options.
The prospective deal has been driven by a spectacular uplift in sales and profits during the first half of its current financial year.
Founded in 2004 by Matthew Moulding and John Gallemore, The Hut Group has demonstrated stellar growth, surpassing £1bn in sales last year.
The company owns brands such as Christophe Robin, ESPA and Eyeko, but also sells third-party branded products such as those made by Glossybox and LookFantastic.
In recent years, it has diversified its technology offering to become a trusted provider of digital services through its own platform, THG Ingenuity, to some of the world’s biggest consumer brands, including Johnson & Johnson, Nestle and Procter & Gamble.
Sources said this weekend that Singapore’s Government Investment Corporation (GIC) was among the funds that had been presented to as part of an investor roadshow in recent weeks.
The company’s last major primary share sale took place more than two years ago, when Old Mutual Global Investors – now called Merian Investors and soon to be part of Jupiter Fund Management – became a shareholder.
It did also receive a new equity injection late last year as part of a broader refinancing that also saw it secure new credit facilities as well as funds provided to a subsidiary that owns its real estate assets.
The Hut Group employs more than 7000 people, making it one of the biggest homegrown employers in northwest England and one of Britain’s fastest-growing technology-led companies.
Other existing shareholders in the company include Sofina, a Belgian investor.
The Hut Group has been frequently tipped to float throughout its 16-year history.
If it does decide to pull the trigger on a listing, it would be among the London market’s most eagerly anticipated floats for years.
The Hut Group declined to comment this weekend.