Hargreaves Lansdown Legal Action - Is the Company Safe

Username_Taken2

I have quite a lot of money with Hargreaves Lansdown, one of our accounts is over the FSCS maximum limit. In light of legal action looking likely with 3 Legal Firms currently looking at launching class action lawsuits actions HL. And with Peter Hargreaves selling about 20% of stake in the company... how safe do you think the company is?

Username999

United Kingdom, 6 February 2020

Accelerated bookbuild offering of approximately £500 million of existing ordinary shares in Hargreaves Lansdown plc

Peter Hargreaves (the "Vendor") is selling approximately £500 million of existing ordinary shares in Hargreaves Lansdown plc ("Hargreaves Lansdown" or the "Company"). The sale will be undertaken via an accelerated bookbuild offering to institutional investors (the "Offering").

The Offering is being undertaken to enable Peter Hargreaves to diversify his assets. Peter Hargreaves intends to remain a significant shareholder for the longer term following the completion of the Offering.

Peter Hargreaves said, "I have decided to sell some of my shares in Hargreaves Lansdown.  This is part of a process of long-term financial planning to diversify my assets.  I remain, and will continue to be, a substantial shareholder in Hargreaves Lansdown.  I am very proud of the business that I co-founded and helped build."

EdGasketTheSecond

HL are currently valued at £7.5Bn so I don't think they are closing doors anytime soon.

talexuser

He is on record as not happy with the existing management vs the Woodford recommendation fiasco. Maybe he thinks the share price will fall, or growth will suffer from the publicity?

bowlhead99

He owned a bit more than 30% of the company and is in his mid 70s. He probably doesn't have much personal need to own a third of the company worth billions. So after the sale he will own more like a quarter of it and diversify his family's portfolio a bit. He has not really sold shares before (though has made charitable distributions or transfers).

A disposal like this doesn't really mark 'the beginning of the end' or imply the company is going under.  Last year Saudi Aramco floated part of their company on the stock exchange so that the owner could diversify while keeping over a trillion of exposure to it. And Hargreaves floated and much later sold some his holding of HL while still keeping over a billion of it.

Certainly if you own a financial services business it's better to sell some of your holdings at a high point of a cycle rather than a low one. That doesn't mean as a customer that the service you use is now 'unsafe'

Johnnyboy11

EdGasketTheSecond said:

HL are currently valued at £7.5Bn so I don't think they are closing doors anytime soon.

"Woodford fund assets dip below £7bn for first time since 2015"

Username999

Not the smartest time to sell, 12 month low, 1600.

(or maybe it is?)

EdGasketTheSecond

Johnnyboy11 said:

EdGasketTheSecond said:

HL are currently valued at £7.5Bn so I don't think they are closing doors anytime soon.

"Woodford fund assets dip below £7bn for first time since 2015"

You're having a laugh? You do realise there is no relevance in what you wrote?