The future of THG's plans to build a huge new head office at Manchester Airport is up in the air after a near £70m deal to finance its construction was cancelled.
Trafford Council first agreed the major £67.5m debt facility with the software and online retail giant in January 2020 as part of a wider £1bn capital fundraising drive. But since then no work on the project, which is to see 300,000sqft of office space created for over 10,000 employees, has started on site.
According to newly-published Trafford Council documents, THG's debt facility "has now matured without any drawdowns for the main facility". THG and Trafford Council have been contacted for comment by the Manchester Evening News.
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At the time the debt facility was first announced, the new headquarters was due to be developed by Airport City Manchester.
CBRE, who advised the council on the deal, said the "return on investment from the loan will enable Trafford to support vital public services whilst making a significant contribution to local economic and job growth". The news follows a turbulent 2022 for THG which saw its shares start to recover from hitting historic lows.
Japanese technology investment giant SoftBank announced in October that it had sold its entire stake to THG co-founder Matthew Moulding and Qatar Investment Authority, the country's sovereign wealth fund. The move saw SoftBank make a £450m loss after it bought an 8% holding in THG in May 2021.
A $1.6bn deal that would have seen SoftBank take a near 20% stake in a major division of THG was abandoned in July last year. In its most recent financial results, the three months to October 25, THG's group revenue rose from £507.8m to £518.6m.
Sales had also risen across its beauty, nutrition, ingenuity and on demand divisions while the group said it had made a "positive start" to the final quarter of the year.
In the same announcement to the London Stock Exchange, THG also confirmed it had recently added £156m to its debt through a deal with BNP Paribas, HSBC and NatWest.
That positive update to the market came only a month after THG announced it had racked up losses of more than £100m during the first six months of 2022. Belerion Capital and King Street Capital Management considered making a £2.07bn bid in May which was unanimously rejected by THG.
A venture capital firm controlled by property tycoon Nick Candy also considered a £1.4bn takeover. However, a month later it was announced that both bids by Belerion Capital and King Street Capital Management and Nick Candy would not taken any further.
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