Following a rejected takeover bid, Frasers Group has acquired more shares in Mulberry.
- The luxury retailer declined Frasers’ £83m cash offer, valuing shares at a 30% premium.
- Challice, major shareholder of Mulberry, supported the decision against Frasers’ offer.
- Frasers secured an additional 4 million shares, increasing its ownership to over 37%.
- Mulberry remains committed to a £10m fundraising, disregarding Frasers’ recent acquisitions.
Frasers Group has strategically increased its investment in Mulberry by acquiring an additional 4.0 million shares, just days after its ambitious takeover bid was declined by the luxury fashion retailer. Despite the rejection, Frasers’ move demonstrates a continued interest in strengthening its presence in the company.
Mulberry took a decisive stand against Frasers’ £83 million cash offer, which proposed a purchase price of 130p per share—a substantial 30% premium over recent market valuations. This decision was backed by Challice, Mulberry’s majority shareholder, and financial advisors, who perceived greater potential in Mulberry’s future valuations beyond the immediate offer.
Challice’s endorsement of the refusal highlights the confidence stakeholders have in Mulberry’s growth trajectory, with the board manifesting a firm belief that Frasers’ bid undervalued the company’s long-term prospects. In rejecting the offer, Mulberry seeks to remain autonomous and focused on its strategic objectives.
In a move to assert more influence, Frasers utilised clawback provisions to subscribe for the additional shares at 100p per share, marginally elevating its stake from 37% to over 37%. This acquisition signals Frasers’ persistent strategy to gain more control and possibly reassess its future actions regarding Mulberry.
Despite the tension, Mulberry has reiterated its commitment to a £10 million fundraising initiative, independent of Frasers’ recent stake increase. The company aims to use these funds to bolster its financial health and pursue market opportunities, suggesting resilience in its independent operations.
Mulberry remains steadfast in its growth strategy despite Frasers Group’s increased stake, focusing on long-term potential over immediate financial gains.
