Abercrombie & Fitch stocks bomb as it abandons merger plans

Abercrombie & Fitch stocks

Abercrombie & Fitch has abandoned considerations for a potential merger, following weeks of speculation over a possible rescue deal.

The struggling fashion retailer‘s shares plummeted 16 per cent yesterday after hopes that it could be bought out were “terminated”.

Following 16 consecutive quarters of decline, rival retailers were reportedly circling the US brand to strike a deal. American Eagle and private equity company Cerberus were thought to be poised to table an offer before Monday‘s announcement.

READ MORE:  Offer imminent for Abercrombie & Fitch

“After a comprehensive review of all relevant factors, with the assistance of our financial advisor, the A&F board of directors determined that the best path to enhance value for stockholders is the rigorous execution of our business plan,” executive chairman Arthur Martinez said.

The retailer has a global estate of over 900 stores, with four in the UK.

It also owns the Hollister fashion chain which is trading more favourably.

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