Stephen Lansdown has ditched £160m of his stake in Hargreaves Lansdown days before it was revealed the platform business planned to do away with its tarnished Wealth 50 buy list.
An RNS filing shows Lansdown (pictured), who founded the business alongside Peter Hargreaves in 1981, sold over 10 million shares on 30 April, slicing his stake in the business by 2.2%.
The sale of Lansdown’s stake was made by a Guernsey-based company that he controls and was conducted via in an accelerated offering through Barclays, according to initial reports. On the day Hargreaves shares fell 12.6% closing out the trading session at £14.40 a share.
Lansdown told Bloomberg he had decided to pare down his Hargreaves stake to free up some cash as markets rebounded from their March lows thanks to the coronavirus sell-off.
He now owns 7.1% of the D2C firm or 33.8 million shares worth £500m.
Lansdown ditches shares days before Wealth 50 announcement
Lansdown disposed of his shares days before it was revealed the platform business plans to scrap its controversial Wealth 50 buy list after just 16 months in the wake of mounting criticisms over its role in the Neil Woodford scandal.
The Sunday Times reported Hargreaves was to debut a replacement Wealth Shortlist, a fund list overseen by an independent panel separate from Hargreaves Lansdown’s existing product governance committee, but this had been delayed to the Covid outbreak.
Additionally, the D2C firm is said to be mulling a revamp of its fund research notes in order to be more transparent, cutting the large stakes it holds in some funds in its multi-manager range and making changes to the fee discounts it offers on some funds.
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News of the buy list revamp pushed Hargreaves’ share price up 2% to £14.63 per share.
But its shares are still some 25% lower than when they were trading at £19.63 a pop at the start of the year due to the coronavirus sell-off which by late March had knocked a third of their value off.
Lansdown’s former business partner Hargreaves managed to sell down £550m of his shares in the platform business in early February, weeks before the sell-off kicked off.
The “serendipitous” sale allowed him to avoid taking an additional £94m hit as stock markets dived toward the end of the month.
