Frasers Group, the parent of Sports Direct, agreed to buy a £10 million ($13 million) stake in THG plc, formerly The Hut Group, a British e-commerce retail company headquartered in Manchester, England. The fundraising will enable the online retailer to spin off its unprofitable tech unit, Ingenuity.
THG’s founder and CEO, Matt Moulding, has also committed £10 million to the effort, raising £95.4 million.
THG sells own-brand and third-party cosmetics and dietary supplements online, and provides an end-to-end e-commerce service to third parties through its Ingenuity division. The London-listed company, formerly The Hut Group, said it would become a “simpler, cash-generative business capable of paying future dividends” after the demerger from its Ingenuity division.
Following the demerger, THG will include its beauty and nutrition business, which provides for Myprotein and Cult Beauty. It also owns Lookfantastic and the City AM newspaper.
Ingenuity, the company’s software and logistics arm, will become a standalone venture.
Frasers’ “strategic investment” in the e-commerce company follows just three months after it acquired THG’s portfolio of luxury goods websites, including the Coggles brand. At the time, it also agreed to integrate Frasers’ loyalty program, Frasers Plus, into THG’s Ingenuity e-commerce platform and stock a range of Myprotein in Sports Direct stores.
Frasers also owns Evans Cycles, the House of Fraser department stores, the luxury streetwear chain Flannels, and multiple brands from Slazenger to Jack Wills.
Image courtesy THG
