Hargreaves Lansdown’s float valuation has been suffering from inflation.
Back in January, when the group appointed Lexicon Partners to explore its options, the reported value being placed on the Sipps, Isas and wraps group was £600m. Last month, when Hargreaves Lansdown confirmed it was heading for the public market, that guidance had increased to £650 to £700m. The range set earlier this month had a mid-point valuation of £711m.
Now the issue has been priced right at the top of the indicated range, at 160p a share, giving the provider of Sipps, Isas and wraps a market value of £759m. At that valuation, the stakes of founders Peter Hargreaves and chairman Stephen Lansdown, who each control about 40 per cent of the business, are worth in excess of £300m and the company will take gross proceeds of £190m out of the offer.
Analysts always believed the IPO would prove popular – the introduction of Sipps in the UK and debate about aging populations and the market for long-term savings make the float very timely.
Clear Capital, an independent research group, point out that at about 21 times earnings for a £750m valuation, investors will be paying for that topicality.