Mike Ashley’s Frasers Group has dropped plans for a £111m takeover offer for luxury handbag maker Mulberry. The group said it had decided not to make a firm offer ahead of Monday’s bid deadline in light of Mulberry’s rejection of its latest sweetened approach and “in the absence of proper engagement from the Mulberry board”. Mulberry’s shares dropped 7% after the announcement.
Frasers urged Mulberry to provide a “credible” plan soon and raised worries over the governance of the fashion firm, which is majority owned by Challice – a group controlled by Singaporean entrepreneur Christina Ong and husband Ong Beng Seng. The Sports Direct owner, which already owns a 37% stake in Mulberry, is pushing for an appointment to the company’s board and said it hopes for “fuller engagement with both Mulberry and Challice on a range of topics”. On Tuesday, from Frasers as being “untenable”.
The London-listed company, which has two factories in Somerset, said its board had decided to rebuff the higher proposed takeover in favour of focusing on boosting its business performance. It said this also took into account the view Challice, which had already rejected the approach, saying it did not plan to sell to Frasers. Frasers said the rejection was a “disappointing outcome”, but stressed it “remains a long-term supporter of the well-loved British brand”.
However, it added: “Frasers continues to believe that market headwinds, and a clear lack of commercial pl.