A manufacturer of sports supplements part-owned by JD Sports Fashion is beginning preparations for a £1bn flotation that could help breathe fresh life into London’s moribund market for new share offerings.
Sky News has learnt that Applied Nutrition, which is based in Liverpool, has been interviewing investment bankers in recent weeks about a listing that could take place in the autumn.
City sources said this weekend that Deutsche Numis was among those in contention for a role on the float, which could rank among the largest in the UK this year.
One person close to the situation cautioned that no firm decision had been taken to press ahead with an initial public offering (IPO).
Founded in 2014, Applied Nutrition formulates and makes premium nutrition supplements for professional athletes and gym enthusiasts.
It is the official nutrition partner of a range of English Football League clubs, including League One’s Bolton Wanderers, and the Scottish Premiership side Glasgow Rangers.
The company, which sells its products in 65 countries, also has partnerships with professional boxers, wrestlers and in sports including basketball, cycling and rugby league.
Its largest brands include ABE – All Black Everything – which is a pre-workout range now stocked by Walmart, the world’s biggest physical retailer and former owner of Asda.
Other products in its portfolio include BodyFuel, a hydration drink.
JD Sports owns just under a third of the shares, while Applied Nutrition’s founder, Thomas Ryder, holds a majority stake.
The remaining shares are understood to be owned by Steven Granite, the company’s chief operating officer.
If it achieves a £1bn valuation by going public, Mr Ryder’s stake would propel him into the ranks of Britain’s richest people.
Applied Nutrition has seen rapid growth in sales and profits in recent years, and has set a £100m sales target for the current financial year.
“Our margins have remained strong despite our rapid growth and our latest results also include the setting-up of our US operation, which is growing at a healthy rate,” Mr Ryder reportedly said late last year.
“Now we’re aiming for £100m turnover in the current financial year, and the first four months are ahead of plan.”
Accounts for the year to the end of July last year disclosed a 74% rise in turnover to £61.2m, with earnings before interest, tax, depreciation and amortisation rising by 80% to £18.1m.
It also launched its first overseas subsidiary in Texas to build its presence in the US.
JD Sports Fashion, the £6bn London-listed retailer, has held a stake in Applied Nutrition since 2021.
Peter Cowgill, JD’s former boss, sat on the board of Applied Nutrition but resigned in 2022, according to Companies House records.
Dominic Platt, the current JD finance chief, was appointed as a director of Applied Nutrition this week.
A successful listing for Applied Nutrition would represent a shot in the arm for the London Stock Exchange’s efforts to attract fast-growing companies to float.
Decisions by a growing number of companies to shift their listings to the US – with Paddy Power-owner Flutter Entertainment becoming the latest example this week – have cast a pall over the City.
Last year saw the number of companies going public in London halving, with proceeds raised from initial public offerings (IPOs) falling by 40% year-on-year.
Chip designer ARM Holdings’ float in New York was interpreted as a further sign that London is no longer punching its weight as a financial centre.
The City regulator has responded by announcing plans to reform London’s listing rules.
“The challenging macroeconomic conditions which drove a slowdown in overall M&A market activity in 2023 had a knock-on effect on IPOs, with a relative pause in activity towards the end of the year,” said Scott McCubbin, UK and Ireland IPO leader at EY, the accountancy firm.
“The stability of equity markets hinges on consistent conditions so whilst falling inflation and interest rate reductions may ease in the first half of 2024, the upcoming UK and US elections in the latter half might delay significant IPO activities until 2025.”
Applied Nutrition and JD Sports Fashion both declined to comment.