THG Ingenuity, which is a social media influencer platform, will be separated from THG in the coming months
THG secures $1.6bn investment commitment from SoftBank in THG Ingenuity. (Credit: 50Stripes/Wikipedia.org)
THG (formerly The Hut Group) is set to sell a 19.9% stake in its yet-to-be-formed technology division – THG Ingenuity for $1.6bn to SoftBank Group’s subsidiary SB Management.
In this connection, the British e-commerce company has signed an option and collaboration agreement with the SoftBank subsidiary.
The deal values 100% of the THG technology division at $6.3bn.
Additionally, SB Management has agreed to acquire a stake in THG for $730m by participating in a share placement.
THG Ingenuity, which has been described by THG’s founder Matthew Moulding as a “social media influencer platform” will be made up of the Ingenuity platform IP and operating trade and assets.
According to THG, Ingenuity is said to provide a scalable direct-to-consumer retail model by incorporating all the necessary components for global digital commerce into a single, digital platform.
The solution is said to help THG provide brands access to all the products and services needed to launch and scale a global e-commerce solution via a single SaaS relationship.
THG said that to facilitate the investment from SB Management, THG Ingenuity has to be a separate legal entity and the process for it has already begun.
The British e-commerce firm stated that the separation of its main businesses will maximise shareholder value. In line with this, the company plans to carry out a review of the group structure with the intention to begin a separation within 15 calendar months.
THG executive chairman and CEO Matthew Moulding said: “We are delighted to announce this financial and trading partnership opportunity with SoftBank, one of the world’s leading technology investors, recognising both the capability and inherent value of our proprietary technology platform, Ingenuity.
“The trading partnership opportunity is particularly exciting, providing Ingenuity with an unparalleled global growth opportunity. Furthermore, the combination of the acceleration of growth within Ingenuity and its separation into a distinct entity will enable THG to unlock significant incremental shareholder value over time.”