Frasers Group’s revised offer for Mulberry has been declined by the majority owner, Challice, highlighting ongoing tensions in the company’s future direction.
- The increased bid of £111m follows an earlier £83m offer, both of which were refused by Challice, who holds a 56.4% stake in Mulberry.
- Challice has expressed a lack of interest in selling its shares to Frasers, underscoring concerns over timing and potential distractions for the company.
- Mulberry’s financial difficulties continue with reported losses, adding complexity to the rejection of Frasers’ overtures.
- The situation remains unresolved with Frasers having a deadline until 28 October to make a firm offer.
The Frasers Group, holding 37% of shares in Mulberry, increased its cash offer to £111 million, equivalent to 150 pence per share. This followed an earlier offer of £83 million, both of which were dismissed by Challice, the principal shareholder with a 56.4% stake in the luxury brand.
Citing an ‘inopportune time’ for any sale, Challice signalled its intent to neither sell its shares nor provide any undertakings concerning the offer. Challice’s statement further emphasised its desire for Frasers to retract its intention to acquire Mulberry.
In response to Challice’s clear stance, Mulberry’s board released a statement indicating that, despite current discussions, there remains uncertainty about whether any formal offer will materialise and under what conditions.
Amidst acquisition talks, Mulberry’s financial performance has been under scrutiny, reporting a pre-tax loss of £34.1 million compared to a previous profit, and a 4% decline in group revenue to £152.8 million over the past year.
Meanwhile, changes within Frasers Group’s leadership were noted as Ger Wright announced her departure as managing director of sport, transitioning to a non-executive director role. Her tenure contributed significantly to Frasers’ elevation strategy, including brand expansion and market entry.
Frasers Group now faces a critical period with a deadline set for 5pm on 28 October to make a definitive proposal regarding its interest in Mulberry.
The outcome of Frasers Group’s pursuit of Mulberry remains uncertain, with key deadlines and decisions imminent.
