Frasers Group has escalated its pursuit of fashion retailer Mulberry, raising its bid following a previous rejection.
- The new proposal values Mulberry at £111 million, a 50% premium on recent fundraising prices.
- Mulberry’s board had previously dismissed an £83 million offer, citing unacknowledged potential.
- Frasers’ latest acquisition has increased its holding in Mulberry to over 37%.
- A definitive offer must be made by 28 October, per UK takeover regulations.
In a strategic move, Frasers Group has revised and increased its takeover bid for Mulberry to £111 million. This move comes shortly after an earlier offer of £83 million was rejected by Mulberry’s board on 1 October, which claimed the bid did not reflect the company’s potential future value. The improved offer presents shareholders with 150p per share in cash, making it significantly more attractive—a 50% premium over the last round of fundraising prices.
Prior to the latest bid, Frasers had acquired nearly four million shares of Mulberry at 100p each. This acquisition, conducted through clawback provisions, slightly increased the group’s stake from its previous position. Initially holding just under 37%, Frasers now controls over 37% of Mulberry’s shares. The increase in the stake solidifies Frasers’ position and hints at the seriousness of its intentions towards Mulberry.
Under UK takeover codes, the October 28 deadline looms for Frasers Group to submit a binding offer or withdraw its interest altogether. This regulatory requirement adds a layer of urgency to Frasers’ dealings, compelling the company to either finalise the acquisition plan or reconsider its strategy. As Frasers manoeuvres through this process, all eyes remain on Mulberry’s reaction and any potential counteractions from other stakeholders.
This bid escalation aligns with Frasers’ recent investment activity, including a significant purchase of £10 million in shares from THG, a company planning to demerge its technology division, Ingenuity. According to THG’s CEO Matthew Moulding, this demerger plan has garnered substantial shareholder support, indicating a positive market reaction. It remains to be seen how these large-scale financial manoeuvres by Frasers will ultimately impact its strategic acquisitions and future market position.
Frasers’ move to raise its offer for Mulberry signifies a strategic effort to secure control amid challenging negotiations.
