French Connection receives takeover bid from second largest investor

Britain's Financial Reporting Council has opened an investigation into the audit of retailer French Connection by accountants Mazars.
Mazars took over auditing for French Connection for the year to January 2020.
// French Connection receives takeover approach from a group of potential buyers
// French Connection put itself up for sale in March
// The retailer’s shares rose 11.7% to 25.8p this morning

French Connection has received a takeover approach from its second largest shareholder after revealing a sharp increase in its share price.

The fashion retailer’s shares increased by 11.7 per cent to 25.8p this morning.

French Connection put itself up for sale in March and announced on Thursday an indicative offer of 30p a share from a group of potential buyers.

READ MORE: French Connection sales nosedive 40% after lockdowns

“The board of French Connection Group plc notes the recent share price movement and confirms that it has received an approach from a consortium of bidders including the company’s second largest shareholder Apinder Singh Ghura, Amarjit Singh Grewal and KJR Brothers Limited as a potential offeror for French Connection,” the company said.

French Connection said it was in talks with the consortium and there was no certainty that an offer would be made.

In April, French Connection revealed that its sales plummeted over the past year as it was battered by enforced store closures during the Covid-19 pandemic.

Group revenues plunged by 40.4 per cent to £71.5 million after Covid lockdowns caused it to shut stores for large parts of its fiscal year.

The retailer added that the pandemic had also “reduced demand” from its wholesale customers.

Retail sales were cut by more than half to £22.5 million and were only partly offset by increased online demand.

As a result of lower sales, French Connection sank to an underlying loss of £11.7 million for the year to January 31, compared with a £2.9 million loss on the previous year.

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