Trading pioneers Peter Hargreaves and Stephen Lansdown are in line for an £800m payday after selling the eponymous business they founded in a spare bedroom in Bristol more than 40 years ago. 

The two men, who co-founded Britain’s biggest share trading platform Hargreaves Lansdown in 1981, have backed a takeover of the business by European and Middle Eastern investors.

Mr Hargreaves, 77, has agreed to sell half his stake in the business for cash to the consortium, composed of big money investors CVC Capital, Nordic Capital and Abu Dhabi’s sovereign wealth fund. The sale will make him £534m. He will also remain a key figure at the group having agreed to roll over the rest of his shares into a new ownership structure backed by the consortium. 

Mr Lansdown, 71, will sell all his shares for cash, netting him around £309m. 

Hargreaves’ board of directors, led by Alison Platt, backed the 1,110p per share offer, which values the FTSE 100 business at £5.4bn. Shareholders are also set to receive a 30p dividend per share. The board said the company, which employs 2,000 people, needed more spending on IT upgrades and going off the stock market was the best option. 

If the deal goes through it will mark the end of a 17-year period on the public markets for the business, which has sought to position itself as a champion of retail investors. The takeover is likely to be regarded as another blow for the London Stock Exchange after a string of other major companies shifted their listings to the US or were taken private.