In the event there were a successful private equity bid for HL, who would leave the platform?

poseidon1

https://www.cityam.com/hargreaves-lansdown-rejects-takeover-bid-from-private-equity-giants/

westv

Surely nobody could make a decision until there was more info on fees and customer service?

cloud_dog

westv said:

Surely nobody could make a decision until there was more info on fees and customer service?

Having worked for a company who was taken over by CVC, I'm fairly certain they will do everything in their power to get blood out of the proverbial stone.

Albermarle

cloud_dog said:

westv said:

Surely nobody could make a decision until there was more info on fees and customer service?

Having worked for a company who was taken over by CVC, I'm fairly certain they will do everything in their power to get blood out of the proverbial stone.

Probably the recent generous cashback offers would soon dry up !

poseidon1

cloud_dog said:

westv said:

Surely nobody could make a decision until there was more info on fees and customer service?

Having worked for a company who was taken over by CVC, I'm fairly certain they will do everything in their power to get blood out of the proverbial stone.

You have hit the nail on the ahead. The classic  playbook of a private equity buy out of quoted companies ( at least as far as UK is concerned) is:

* Fund the takeover with enormous debt

* The company's taxable profits disappear virtually immediately 

* Corporation tax falls to zero ( in the case of HL  this would entail a loss  to the Exchequer of between £55 to £65 million annually).

* Another constituent of the FTSE all share index disappears never to return, so a loss to the few UK investors who wish to invest domestically.

* Since private equity payback periods are between 5 to 7 years, economies/ efficiency measures are implemented ( sometimes savagely) to achieve this - think job losses, asset stripping etc.

Very difficult to put a positive spin on private equity buy outs unless you are the large  shareholders and higher paid company execs that benefit in the short term.

SVaz

We would.   Foreign takeover generally means poorer customer experience.
 

HL excel at customer service and have UK call centre staff ,  that’s why I don’t mind paying their fees.  I had trouble making an online lump sum payment into my Sipp so rang them,  the guy took my payment over the phone and asked me if I wanted him to invest it for me, which saved me a job. 

I’d hate to leave, we both have Sipps and Active savings plus my Wife has a S&S ISA with them, but we’d do it if there is a foreign buy out.  

Albermarle

We would.   Foreign takeover generally means poorer customer experience

Not sure foreign takeover means that, but private equity takeover often does. The AA & the RAC are prime examples.

af1963

It's what the word "enshittification" was invented for.

artyboy

Albermarle said:

cloud_dog said:

westv said:

Surely nobody could make a decision until there was more info on fees and customer service?

Having worked for a company who was taken over by CVC, I'm fairly certain they will do everything in their power to get blood out of the proverbial stone.

Probably the recent generous cashback offers would soon dry up !

Depends... if it's a pump and dump strategy, they will want to build market share as quickly as possible, more AUM means a better (theoretical) valuation. 

More likely that the lock in period increases, and the time until cashback is paid out does likewise (HL are pretty immediate once transfers in complete, me likey...  )

Somebody

I moved when there was a II cashback offer in February.  Finally completed 14th May. 

Downloaded the HL Spring Investment report (Qtr ended 30 April 2024) today and gulped at the schedule of charges paid for the year.

poseidon1

https://www.cityam.com/hargreaves-lansdown-willing-to-recommend-new-5-4bn-cvc-led-takeover-to-shareholders/

Seems Peter Hargreaves is prepared to back this private equity bid for HL.

The paucity of responses to the question raised in my original post suggests either lack of awareness of the implications of HL going private, or apathy of the wider consequences of the so called champion of DIY investing, packaging its  clients as an exclusive profit centre for the very rich to the detriment of the FTSE.

This has given me the kick I needed to move all my remaining HL  business to Interactive Investors and hope Abrd will not feel similarly inclined at some point to put their platform on the auction block.