Matt Moulding’s Recursive Activism

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Here’s one for corporate governance professionals.

Kelso is a UK-listed activist investor whose largest holding by far is THG, a protein bar maker and online cosmetics retailer. He says he owns about 0.5 percent of THG shares, worth about £4.6m at today’s price, after first buying in January 2023.

Kelso says THG is trading at a «significant discount to sum of parts value» and wants the company to deliver on its promise to move its listing from London Standard to Premium. In protest at what it sees as a lack of progress, Kelso intends to vote against the reappointment of THG chairman Charles Allen at the AGM scheduled for June 24.

Kelso’s largest shareholder is CEO John Goold, who has 11.36 percent of the shares. Its second largest shareholder is Matt Moulding, co-founder and CEO of THG. After appearing on the Kelso register for the first time in late November 2023, Molding raised its stake to 9.11 percent, according to today’s regulatory filing.

Molding hasn’t said anything publicly about his personal investment in Kelso (and isn’t taking our calls), so we have to approach this hypothetically.

Kelso directors hold 16.31 percent of its total shares, according to Bloomberg data. It is their fiduciary duty to act in the best interest of all shareholders. The largest independent shareholder is Molding, followed by a host of custodial accounts for retail brokerages.

It’s reasonable to think that Molding is happy with the way he’s running THG, so he doesn’t believe Kelso has much of an argument. «People tell me every day that THG should do things differently,» he wrote on LinkedIn last month:

From advisors, commentators, investors, friends, family or even strangers at a family dinner – everyone has a lot to say. Of course, it has grown further since being listed.

I’ve learned to soak it up and listen to most advice….and then rarely act on it! Listening, processing and then discarding 95% of the advice is super valuable.


If we followed all the advice, it would be as effective as drinking water from a fire hose. Most people who share their views are unaware that countless others advise the exact opposite.

Kelso said last week that «two accounts of shareholders» voted against three of his resolutions at the AGM. We’ve reached out to the company for more details and, if the response is helpful, we’ll update this post.

At current prices, ceteris paribus, Molding could become the largest shareholder in Kelso if he spends another £200,000. With a £750,000 share purchase, it could exceed the total share held by insiders. For a little more than the price of a City AM, it would reach 25 percent and gain the power to block special resolutions.

A major hurdle facing Molding’s brokers would be finding Kelso shares to buy, as only 800,000 of them trade on average daily. Still, from a fiduciary duty perspective, it’s an odd arrangement.

Kelso’s board has a duty to all Kelso’s shareholders to do things that will benefit them equally. So far, it’s safe to say that the campaign to change the way THG is run is in the best interests of all shareholders, including Moulding, regardless of what he believes. But Molding is not your average shareholder. His wealth is tied to THG and his main duty is to do what is in the best interest all THG shareholders, which includes Kelso. And since Kelso’s stake in THG is insignificant compared to Moulding’s stake in Kelso, it’s not obvious who should be working for whom.

But then, we are by no means experts in corporate governance. If you are, dear reader, let the comment box be your canvas.

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