MARKET REPORT: Pressure grows on Hut Group to axe chairman

With the annual general meeting (AGM) season in full swing, there are bound to be several ding-dongs between companies and their shareholders.

Among them is the bubbling row over the future of The Hut Group (THG) – with pressure mounting on the online beauty and nutrition firm to ditch its chairman. 

Kelso Group had led calls for shareholders to vote against the re-election of Charles Allen – the former chief executive of Compass Group (down 1.5 per cent, or 33p, to 2207p) and ITV (down 1.1 per cent, or 0.85p, to 78.2p) – at THG’s AGM on June 24.

But the activist investor’s demand has been backed by Dutch investment firm OVMK, which holds a near-2 per cent stake.

Both shareholders have called for THG to be broken up, arguing management should spin off its beauty, nutrition and e-commerce arms into separate companies. 

Investor discontent: Pressure is mounting on online beauty and nutrition firm The Hut Group to ditch its chairman and spin off its beauty, nutrition and e-commerce arms

THG floated at 500p a share in September 2020, valuing the business at £5.4billion.

Kelso believes that the value of the three divisions is significantly higher than the £928million the company is currently worth.

Last week THG founder Matt Moulding has raised his stake in Kelso Group for the third time this year.

Shares edged up 0.6 per cent, or 0.45p, to 70.25p. Kelso Group was unchanged at 3.25p.

The FTSE 100 fell 0.2 per cent, or 16.89 points, to 8228.48 and the FTSE 250 slid 0.5 per cent, or 109.33 points, to 20446.04.

Digital advertising group Brave Bison has abandoned its takeover of Mission Group.

The suitor, which runs the Social Chain agency started by Dragons’ Den star Steven Bartlett, hit out at its rival for failing to engage in ‘constructive dialogue’ and extend the offer deadline.

Stock Watch – Clontarf Energy 

Shares in Clontarf Energy jumped 83.9 per cent, or 0.01p, to 0.03p after it ramped up its lithium business in Bolivia.

The company said the EU wants to help the South American nation, which holds more than half of the world’s economic lithium resources, to become an exporter.

The update came alongside the company’s annual results that showed its losses narrowed to £870,000 last year – down from £4.8million in 2022.

Last week Mission Group rejected Brave Bison’s sweetened offer of £32.3million – up from a previous proposal of £27million and yesterday insisted it is ‘confident in its stand-alone prospects’. 

Shares in Brave Bison dipped 1 per cent, or 0.03p, to 2.43p and Mission Group tumbled 11.1 per cent, or 3p, to 24p.

Shares in FTSE 100 Ashtead barely moved in the first session since reports emerged over the weekend the equipment hire giant is considering a move to the New York stock. 

The £24billion group is in the early stages of exploring a switch of its listing from London to Wall Street, the Sunday Telegraph reported.

An Ashtead spokesman said the company ‘reviews its capital structure regularly, including its domicile, recognising the fact that 90 per cent of its business is in the US’. The stock inched up 1.5 per cent, or 84p, to 5642p.

Chemring edged up 0.3 per cent, or 1p, to 385p after the defence group won a £65million explosives order from Northrop Grumman.

Aviva fell after JP Morgan downgraded its rating. Shares in the insurer shed 1.7 per cent, or 7.9p, to 470p.

But Just Group made gains following two broker upgrades.

One came from JP Morgan, while Peel Hunt believe shares are undervalued and should increase in the medium term. Shares added 2.6 per cent, or 2.6p, to 103.6p.