Apollo recruits former Coty and Holland & Barrett bosses to advise on THG buyout

Apollo Global Management has enlisted former Coty boss Camillo Pane and former Holland & Barrett CEO Tony Buffin to advise on its potential THG buyout.

The pair's involvement makes a move from Apollo more likely, according to Sky News. However, it is unclear whether Pane or Buffin would have any ongoing role with the business if Apollo succeeds in taking over the business.

The news follows THG's initial takeover proposal from Apollo Global Management last month. The group said it had received a “highly preliminary and non-binding indicative proposal” to acquire the whole business. However, it did not disclose the terms or valuation of the proposal.

“There can be no certainty that any firm offer will be made,” the group added. Apollo must announce whether it plans to make a firm offer or walk away by a deadline of 15 May, in line with takeover regulations.

Last year, the company received a £2.1 billion takeover approach by a consortium led by Belerion and King Street Capital Management but rejected the move. The suitors walked away from talks soon after, whilst interest from British property developer Nick Candy also fizzled out.

The Manchester-based business was founded by Matt Moulding and John Gallemore in 2004. It has grown through a raft of acquisitions of online retail brands, but has seen its valuation tumble over the past two years as cost inflation has impacted profitability and the firm has faced scrutiny over its corporate governance.

In a recent trading update, THG reported an operating loss of £495.6 million for the year ending 31 December 2022. Total revenues increased 2.7% to £2.2 billion, with the group's beauty sales up 4.5%.

The results came as THG CEO Matthew Moulding criticised the negativity from hedge funds, the media and bank analysts, following the initial buyout approach from Apollo. In a post on social media, Moulding said that "a select few within the world of hedge funds, media and bank analysts regularly build negative coverage against UK listed companies, including THG.

"The more aggressive the claims and actions against a company, the bigger the share price impact," he said.

However, Moulding acknowledged that press coverage about THG's potential buyout from Apollo had raised the group's share prices instead of tanking it.