THG proposed IPO

THG are apparently considering separately listing their beauty brands next year. The group share price has unsurprisingly dropped today but can they do that?

So as an investor, you buy into a company based on it discounted cash flow and then it takes part of that business away and lists it. Surely there are rules against that. Or do you have rights as an investor to shares in the new listing?

If it’s part of the group, then investors in THG should get shares in the underlying being listed pro rata, or THG should receive cash from the listing. Investors in THG shouldn’t lose out as that would be against the responsibility of its company directors.

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Thanks! It’s not something I’ve come across before. Will be interesting to see how it plays out.