Hargreaves Lansdown pays out £119 million in dividends since delisting in major private equity takeover

Hargreaves Lansdown, the Bristol-based wealth manager, has distributed £119 million in dividends to its new private equity owners in the six months following its high-profile delisting from the London Stock Exchange. The company, which oversees a record-breaking £172.7 billion of client assets, was acquired in a £5.4 billion deal earlier this year by a consortium led by CVC, Nordic Capital, and the Abu Dhabi Investment Authority.

According to the firm’s latest annual report, two notable dividend payments have been made since the takeover was completed in late March, with £75 million issued for the recently finished financial year and a further £44 million for the current period. These payments were channelled through Hargreaves Lansdown Group Limited, a new UK entity established as part of the transaction, before progressing up to the Jersey-based ultimate holding company controlled by the consortium’s funds.

The annual report also highlighted a notable increase in profitability for Hargreaves Lansdown, with pre-tax profits rising 2 per cent to £405.1 million in the year to June. That gain came against a backdrop of rapidly growing assets and a surge in client numbers. Over 136,000 new customers joined the platform during the year, bringing in £6 billion in net new business and benefiting from an additional £11.4 billion from positive market movements. Revenues grew 13 per cent to £860.6 million, buoyed by heightened trading activity.

Hargreaves Lansdown, founded over four decades ago by Peter Hargreaves and Stephen Lansdown, continues to hold its position as the UK’s largest DIY investment service. The company’s delisting and transition to private ownership have ushered in a period of significant change, with the new backers launching a broad overhaul of operations, including considerable investment in technology. The annual report noted a steady full-time headcount at 2,477, though contractor numbers have been cut by two thirds since the takeover.

Management changes are also underway. Former chief executive Dan Olley has departed, with Richard Flint, previously of the gambling sector, stepping in as interim chief executive. Meanwhile, Peter Hargreaves has returned as a non-executive director, having reinvested half his former 20 per cent stake as part of the acquisition. The landscape for Hargreaves Lansdown remains highly competitive, with major players such as JPMorgan Chase set to enter the UK’s DIY investment market in the coming year.

During its last full year as a quoted business, Hargreaves Lansdown paid out £204.8 million in dividends. The current private equity ownership is expected to follow the familiar industry blueprint of holding the asset for three to five years, driving performance through restructuring and efficiency improvements before seeking an exit.