Huel weighs London IPO as appetite for plant-based meal replacements grows

The plant-based meal replacement maker Huel has hired bankers to advise on an initial public offering in London after a surge in popularity for its products in the pandemic fitness boom.

The Hertfordshire-based group is working with Goldman Sachs and JPMorgan on a flotation of the business that could take place next year.

The banks are also giving advice on a potential sale of the business in a dual-track process, although an IPO is seen by those involved in the process as the preferred option to fund future growth, said people briefed on the situation. Huel declined to comment.

Huel makes “complete food” powders, drinks, snacks and dried meals that are assembled from plant ingredients such as oats, coconut and flax seeds and boast of containing “26 essential vitamins and minerals”.

The group’s founder Julian Hearn previously established and sold Mash Up Media, an affiliate marketing company that hosts vouchers online. He launched Huel in 2015 with its headquarters in Tring, Hertfordshire and has expanded fast internationally, including sales into the US, Japan and continental Europe.

A London listing for Huel would provide a fresh boost to the UK stock market after a recent slowing of new IPOs and worries that investor appetite for backing fast-growth but often low profit-making businesses was waning.

The FT reported last week that Imagination Technologies, the Chinese-backed UK chipmaker, had also appointed banks to advise on an IPO in 2022.

Huel is seen as one of the UK’s most promising start-ups, with a strong social media presence to appeal to younger, fitness-focused consumers. A majority of its sales are made directly to consumers online, including through subscriptions.

The group reported £71.6m of turnover for the year to July 2020, up from £50.2m a year earlier, according to its most recent accounts filed at Companies House. Operating profit for the year to July 2020 was £700,000.

James McMaster, a former executive at dessert brand Gü Puds and baby food maker Ella’s Kitchen, was brought in as chief executive in 2017, with Hearn taking the role of chief marketing officer. Huel this year added Steven Bartlett, the 29-year-old founder of social media agency Social Chain, as a non-executive director.

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