WARRINGTON Borough Council says its arrangement is ‘secured against assets’ after it lent the billionaire owner of The Hut Group £151 million.

The move came after the online retailer’s £5 billion market listing.

The loan was first reported by The Financial Times and subsequently by publications including The Guardian.

The Financial Times has reported that the council provided one of its largest loans of more than £150 million to the billionaire founder of The Hut Group (THG), Matt Moulding, after he purchased a swath of the online retailer’s properties ahead of its stock market flotation.

The publication says that it is considerably more than the £70m Trafford Borough Council lent directly to THG at the start of 2020 to help finance the construction of the group’s Manchester headquarters. Both loans were arranged by CBRE, a real estate advisory firm.

The Warrington loan was used to facilitate the construction of new properties for THG’s use, and followed a series of property transactions undertaken by companies controlled by Moulding around the time THG launched its £5 billion IPO in September 2020.

It is secured against assets including various commercial properties around Manchester airport. Many of THG’s freehold property assets have been transferred to companies controlled by Moulding through Guernsey-domiciled Moulding Capital Ltd (MCL).

These companies now let the properties back to THG for annual rent of about £19 million.

THG has a huge site on Omega.

Warrington Borough Council has issued a statement on the loan.

A spokesman said: “Our objective is to secure good quality jobs for local residents and to support the local economy.

“This arrangement is secured against assets and The Hut Group, as one of Warrington’s largest employers, has brought in a significant number of jobs locally.”

Conservative Cllr Mark Jervis, who sits on the council’s audit and corporate governance committee, has also commented.

He said: “This new loan facility of £202 million,  of which some £151 million appears to have been advanced, is further stark evidence that Warrington Borough Council’s Labour leadership are no longer focussed on their role to provide local community services but are instead offering multi-million pound loan facilities.

“The failure to secure sign off of the council accounts since 2017/18 and concerns over investments such as Redwood Bank and Together Energy calls into question the Labour council’s expertise in this area.

“There is a lack of openness from Labour with this deal appearing to have been approved by the Labour cabinet behind closed doors in late 2020. No details on the terms of the deal have been released and there is therefore no evidence to determine whether the loan has supported new jobs in Warrington.

“Labour are using public money to do commercial deals. It is not open and transparent and the risks to Warrington’s residents are completely unknown.”