Thirlwell, who is chief executive of Hotel Chocolat and son of the inventor of Mr Whippy ice cream, said he planned to reinvest around 80pc of the cash into the firm, which he will continue to run. It is understood that Harris will keep the full £140m for his efforts. Analysts at Peel Hunt described the Mars offer as a "knockout bid". It follows a series of London-listed companies being snapped up by foreigners this year. Veterinary firm Dechra, payments provider Network International and software giant Instem have all been sold off, raising concerns of low valuations leading to bargain hunting in the City.
One leading fund manager said the offer for Hotel Chocolat underlined "the absurdity of UK small-cap valuations", with Mars's bid well above the 139p closing price on Wednesday. "If Mars thinks the business is worth 375p, it is," said Richard Bernstein, the boss of Crystal Amber, which invests in stocks on London's Alternative Investment Market. With the London market continuing to undervalue British firms, he warned there were "many other sitting ducks" for overseas predators.
Hotel Chocolat was originally called Choc Express before being rebranded in 2004. It opened its first store in London nearly 20 years ago and now has about 125 across the UK. After growing its online business, it listed on London's junior stock market in 2016 at 148p per share, giving it a value of £214m. The shares peaked at 538p in late 2021 before falling sharply as runaway inflation and high interest rates took their toll.
This year it warned that consumers were spending less on expensive chocolate, with sales tumbling 10pc in the year to July. The group has also struggled to build its business overseas. Last year it announced the closure of its US stores amid mounting losses and wrote off its investment in a Japanese joint venture. The company has since agreed a new partnership in Japan, giving it about 20 stores there. It also has a luxury hotel on its cacao farm on the Caribbean island of St Lucia.
Thirlwell said the takeover by Mars will be a game-changer for the company, adding: "We know our brand resonates with consumers overseas, but operational supply chain challenges have held us back. "By partnering with Mars, we can grow our international presence more quickly." The takeover is just a drop in the ocean for Mars, whose empire ranges from the Mars bar, Skittles and M&M's to pet food such as Whiskas and Sheba.
The US giant, with sales of £38bn last year, is still owned by its founding family and is secretive. Andrew Clarke, global president of Mars Snacking, said: "We have long admired the fantastic business Angus, Peter and the Hotel Chocolat team have created. "Hotel Chocolat is a much-loved brand, with an impressive product offering and a deep commitment to its values of originality, authenticity and ethical trading."