French Connection’s founder and chief executive Stephen Marks has started shopping for possible bidders on his 42 per cent stake in the fashion brand he started in 1969.
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According to Sky News, Marks’ investment bank Numis Securities has approached a number of prospective bidders in the past few days to buy his stake in the brand.
Under City rules, a deal would almost certainly trigger an offer for the whole of French Connection, while a full takeover would likely lead to Marks’ retirement from the business.
It’s thought French Connection could make a stock exchange announcement about the talks as soon as this week.
However, the process is understood to still be in the early stages.
Numis is believed to have approached a number of private equity firms and other fashion retailers.
A sale is also likely to be influenced by Mike Ashley, who owns roughly 27 per cent of French Connection.
Despite failing to connect to a younger market in recent years (in contrast to the brand’s wildly popular FCUK campaigns of the 1990s and 2000s), French Connection has spent the last few quarters getting its house in order.
The company has been boosted by a strong sales performance on Asos, as well as selling its 75 per cent stake in lifestyle brand Toast.
Once a mainstay on the British high street, Marks has been steadily closing physical stores to reduce the brand’s total number to just 30 by the end of the year.
While like-for-like sales dropped 7 per cent for the half year to July 31, Marks noted that his strategic investments away from the high street were helping the business stay “on track” to achieve profitability by the end of its financial year in January.
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