10 Deals of HMT – the disposal of Netmums
To celebrate its 25th anniversary advising on corporate finance transactions, HMT is reminiscing on 10 notable transactions from our archives. Having completed over 500 transactions, producing a shortlist of 10 has not been easy but the disposal of Netmums in 2011 has certainly made the list.
After having her first child, Siobhan Freegard OBE quickly realised how important being part of a parenting community was for new mums. At that time, internet was starting to arrive in people’s home and Siobhan decided to start Netmums, a website for mums by mums. Although facing various challenges to compete with bigger brands, the social network for parents grew quickly and organically in the following years becoming the No1 parenting website in the UK. In 2010, Netmums reached 1 million members and had 5 million unique visitors each month.
When her children reached their teen years, Siobhan realised that it was the time to sell the company to a media business who would be able to develop and grow the community. Netmums’ shareholders started to look for potential acquirers and, as a former director of Keith Prowse (a transaction that we will feature in another article), Siobhan remembered how HMT helped with the MBO and subsequent sale a few years earlier. Siobhan met with HMT and appointed the corporate finance boutique to sell the business. Andrew and the team at HMT analysed all the financial details and put everything together to build a proper business and financial model. HMT identified global media group Aufeminin as potential acquirer. At the time, Aufeminin owned the largest female website in every country in Europe except in the UK and acquiring Netmums would enable them to become the European leader in their sector. HMT negotiated the transaction with Aufeminin and Siobhan stayed at Netmums to facilitate the transition.
In 2014, Siobhan left Netmums and realised that the web had evolved. Her children don’t google things anymore, they “youtube” them. She saw an opportunity to create a video-based parenting community and gathered a group of 10 well know parenting vloggers. This is how Channel Mum was born. After running Channel Mum for a year, Siobhan decided that she needed someone to “share the dream with her” and invest in the business. She contacted HMT and with their help managed to get giant broadcaster iTV to invest into Channel Mum in 2015. A year later, Siobhan decided to look for a series B investment and appointed HMT again. Andrew and Julia built a robust financial model and identified potential investors. One of them was NVM Private Equity. Siobhan knew NVM from her time at Keith Prowse as the private equity house supported the MBO in 2001. NVM saw the potential in Siobhan and her team and invested £2 million in Channel Mum in 2016. Since then, Channel Mum is rapidly growing and reached 19,000 Youtube subscribers last month. The investment in Channel Mum by NVM was awarded Deal of the Year at the 2017 Thames Valley Deal Awards.