Growing speculation H&M chairman could make buyout bid

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H&M update

Hennes & Mauritz (H&M) chairman Stefan Persson could have the high street retailer in his sights for a buyout as he continues to shore up shares.

Together with his sister Lottie Tham, Persson currently owns a 51 per share in the apparel giant, equating to around £8 billion in shares.

The Swedish businessman has spent just under £1 billion acquiring shares in H&M this year alone, despite the fast fashion retailer struggling to compete against cut-price rivals including Asos and Primark.

According to The Mail on Sunday, it’s thought Persson could be acquiring the shares in order to bid for the Swedish apparel chain to stop it from a potential hedge fund buyout and in order to revive its fortunes.

Sources speaking to the paper said Persson has been in contact with banks Goldman Sachs, JP Morgan, UBS and Natixis about building a debt financing package for further share purchases and working on a deal to take H&M private.

Although Persson has repeatedly denied claims he plans to take H&M private, sources cited by The Mail on Sunday think Persson would likely increase his family’s shareholding to around 70 per cent before launching any kind of buy-out.

The speculation comes as H&M this morning revealed a higher-than-expected growth in sales for its third quarter.

Local-currency sales including VAT in the June to August period rose four per cent from a year earlier, against a mean Reuters poll forecast for a 1.9 per cent increase.

Reported sales excluding VAT were up nine per cent to SEK 55.8 billion (£4.7 billion), beating a forecast 5.5 per cent rise to SEK 54.0 billion.

H&M said a focus on revamping its business and reducing deteriorating profits had led to a boost in sales for the quarter.

Shares rose 10 per cent in early trade, ahead of H&M’s report for the next nine months to August 31 on September 27.

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