Mulberry Rejects Frasers' £111m Takeover Bid as Unviable
- Mulberry's board has rejected a £111 million takeover proposal from Frasers Group, preferring to enhance its business performance.
- The company faces significant challenges, with shares falling over 30% due to inflation affecting luxury spending.
- This decision reflects Mulberry's commitment to its long-term growth strategy and engagement with supportive shareholders.
In a recent development in the UK luxury fashion market, Mulberry has firmly rejected a £111 million takeover bid from Frasers Group, owned by Mike Ashley. Following the enhanced offer for the remaining shares not already owned by Frasers, Mulberry's board prioritizes enhancing its commercial performance. The company also considers the sentiments of its largest shareholder, Challice, who has expressed opposition to a sale. The board emphasizes its commitment to focusing on business growth, despite Frasers’ significant stake. Frasers Group, which has a 37% ownership in Mulberry, initially proposed £130 per share earlier this month but was turned down as well. The company's shares have experienced a significant decline of over 30% in the past year, exacerbated by current economic pressures affecting luxury consumer spending. The luxury sector is facing challenges amidst inflation, contributing to the drop in share prices. Furthermore, Frasers Group's deadline to make a firm bid or withdraw is set for October 28 under City Takeover Panel regulations. Despite the rejection of the offer, Mulberry’s leadership acknowledges the prior support offered by Frasers during recent fundraising activities aimed at bolstering the brand's value. This ongoing relationship and potential future interactions remain a point of focus for Mulberry’s board. In summary, Mulberry remains determined to drive its business's commercial success and rebuff unsolicited takeover offers, indicating a strategy focused on long-term growth.