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The billionaire co-founder of Hargreaves Lansdown will return to the group board of investment platforms following a private equity takeover, ten years after resigning as director.
According to those familiar with the issue, Peter Hargreaves, who founded the UK’s largest retail investment site in 1981, founded the UK’s largest retail investment site in 1981, moving his son, Robert forward to the board observer.
The move shows Hargreaves is involved in its involvement with retail investment companies after £5.4 billion sale to a group of private equity companies, including CVC Capital Partners. After he denounced the group’s previous management team, he mainly sided with a “hellish scene” that cut stock prices by halving.
Hargreaves is expected to assume the role of director on the group board within weeks, said one of those familiar with the move. Robert, who previously worked at Hargreaves Lansdown, can attend meetings, but observers don’t have the right to vote, said people close to the situation.
Hargreaves held about 10% stake and won over £500 million after selling half of the 20% that it holds the acquisition. As a result of the remaining large shares of the company that floated in 2007, Hargreaves has the right to nominate a board director and observer.
Stephen Lansdown, co-founder of Hargreaves Lansdown, has chosen to sell nearly 6% of its holdings on sales to private equity. “It’s a bittersweet moment for me personally, but I feel it’s the right time to focus on Hargreaves Lansdown and other projects.”
When it launched more than 40 years ago, Hargreaves Lansdown pioneered the pioneering stocks and funds directly to retail investors, allowing customers to bypass financial advisors.
However, the acquisitions by CVC, Nordic Capital and Platinum Ivy, wholly owned subsidiary of Abu Dhabi Investment Authority, followed a difficult few years in which customer inflows slowed, costs rose and stock prices fell from £24 to £7. The private equity company paid £11.40 per share.
Hargreaves Lansdown floated at 160p per share, giving it a value of £759m. Peter Hargreaves resigned from his non-executive board role in 2015, just five years after abandoning his role as CEO.
As a result of the acquisition, the Hargreaves Lansdown board filed for resignation at the end of last month. Bruce Hemphill, former CEO of Financial Services Group Old Mutual, has been appointed chairman of the group committee. Other directors include Peter Rutland, managing partner of CVC.
According to one analyst, under private ownership, it’s easy for Hargreaves Lansdown to reduce the fees charged to customers.
Nordic Capital, a member of the consortium, previously invested in Nordnet, a similar digital investment site. Nordic Capital made its business private in 2016 and relisted it in 2020. Under private ownership, Nordic has invested around 100 million euros in Nordnet’s technology and digital services for clients.
Hargreaves Lansdown declined to comment. Peter Hargreaves said “We are delighted that many of our clients remain loyal,” and “we strive to reward that faith by constantly improving our company.”
