Hargreaves founders ponder £600m flotation

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The Independent Online

The investment broker Hargreaves Lansdown is considering a flotation on the London Stock Exchange.

Industry sources suggest the asset manager, which was set up in 1981 by chief executive Peter Hargreaves and chairman Stephen Lansdown, could be valued at around £600m, netting its founders £240m.

Richard Hunter, head of UK equities at the firm, said Hargreaves Lansdown had been looking at a listing for some time.

"This is something that the company has been considering as the next stage of its development," he said. "However, it very early days yet."

He said it was too early to comment on how much the company would be worth.

It is understood that Hargreaves Lansdown talked to a number of investment banks last week to decide who could advise on the flotation, which is likely to take place over the summer.

Mr Hargreaves and Mr Lansdown each control around 40 per cent of the business, while the rest is owned by members of staff.

The Bristol-based firm was set up to advise private clients on unit trusts and tax planning matters, and has grown to be the largest broker of unit trusts in the UK. It has 600 staff and 350,000 active customers, and handles £6bn of funds for customers using its Vantage account. This allows clients to hold a range of investments, including unit trusts, personal pensions plans and Isas. The firm also manages around £850m in investment funds, owns the eighth largest execution-only retail stockbroker, and also one of the UK's largest fund supermarkets.

Mr Lansdown, who is chairman of Bristol City and a major shareholder in the football club, specialised in taxation with Touche Ross before leaving to join an investment brokerage, where he met Mr Hargreaves. Mr Hargreaves is on the board of ITM Power.

Hargreaves Lansdown made a pre-tax profit of £14.4m in 2005, and had a turnover of £48m.

Jonathan Bloomer, a former chief executive of Prudential, and Mike Evans, a former senior executive at Skandia, recently joined the board.