French Connection attracts bidders for a potential takeover

Losses were reduced and revenue at French Connection increased in the six months to 31 July, as the retailer reduced its overheads.
“I am pleased that the improvement in business we saw in the early part of the period has continued throughout the first half of the financial year." : Stephen Marks,
// French Connection approached by two companies about a takeover bid
// It has been approached by retail investor Spotlight Brands, with backing from restructuring and investment firm Gordon Brothers
// Both Spotlight and Go Global Retail have until 5pm today to announce firm interest in acquiring French Connection

French Connection is considering a sale of the business after receiving separate takeover approaches from two companies.

The fashion retailer, which has suffered from Covid-19 disruption, revealed that it has been approached by retail investor Spotlight Brands, with backing from restructuring and investment firm Gordon Brothers.

Both Spotlight and Go Global Retail have until 5pm today to announce firm interest in acquiring French Connection, although the deadline can be extended.


READ MORE:


French Connection made the announcement after its share price jumped 40 per cent yesterday due to speculation, and is now valued at around £15.2 million.

The retailer’s largest shareholder is boss Stephen Marks, with a 42 per cent stake, while Mike Ashley’s Frasers Group holds a 24.93 per cent stake.

Spotlight Brands is a “next generation brand investment and management platform” formed by Los Angeles-based Strand Equity.

Meanwhile, Go Global Retail invests in fashion brands and has offices in the US and London.

At its most recent financial update in October 2020, French Connection reported its toughest ever trading period, as losses spiralled.

The fashion retailer recorded an underlying loss of £12.2 million in the six months to July 31 compared with a loss of £3.6 million during the same period the previous year, which it attributed to a “significant decline in sales”.

French Connection’s sales declined by more than half, down 53 per cent year on year to £23.9 million “predominantly owing to the impact of the Covid-19 pandemic”.

Click here to sign up to Retail Gazette‘s free daily email newsletter

2 COMMENTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here