Frasers Group boosts its shareholding in Mulberry following a rejected takeover bid.
- Frasers Group subscribed to an additional 4 million shares at 100p each.
- The retail group proposed a £83 million takeover, valuing Mulberry shares at a premium.
- Major shareholder Challice supported the board’s decision to reject the offer.
- Mulberry intends to pursue its £10 million fundraising independently.
Frasers Group, controlled by Mike Ashley, has increased its stake in the luxury fashion retailer Mulberry just days after its takeover bid was turned down. The group acquired 4 million shares at the price of 100p each through clawback provisions accessible to major shareholders. Prior to this transaction, Frasers Group, also the owner of Sports Direct, possessed 22.1 million shares in Mulberry, equating to a stake of just under 37%. This new acquisition now elevates their holding to slightly above 37%.
Mulberry recently rejected Frasers Group’s proposal for a takeover valued at £83 million, equating to an offer of 130p per share, which was approximately a 30% premium on its current share price. After discussions with financial advisers and the majority shareholder Challice, Mulberry’s board concluded that the offer did not adequately recognise the company’s substantial future potential. This conclusion was reached despite being cognizant of Frasers Group’s interest.
In light of the takeover bid rejection, Mulberry has indicated that it will not retract its plans for a £10 million fundraise, a move that reportedly caused frustration within Frasers Group. Nevertheless, Mulberry has pledged to cooperate with the FTSE 100-listed Frasers Group in relation to the share subscription, illustrating a willingness to engage despite the previous disagreement.
Frasers Group continues to strengthen its investment in Mulberry, despite previous setbacks, illustrating confidence in the luxury brand’s potential.
