The British handbag maker Mulberry has rejected an £83m takeover proposal from Mike Ashley’s Frasers Group as too low, insisting instead that it would push on with a planned fundraising to fund a turnaround. The luxury brand said it had considered the approach carefully and consulted its 56.1% majority shareholder Challice, controlled by the Singaporean entrepreneur Christina Ong, who had “no interest” in pursuing the possible offer.
Frasers, which owns Sports Direct, Evans Cycles, the House of Fraser department stores and multiple other retail brands from Slazenger to Jack Wills, has a 36.8% stake in Mulberry . On Monday, it said it was making an offer for the rest of the company worth 130p a share, pitting itself against its rival large shareholder.
The Mulberry board said on Tuesday it believed the recent appointment of Andrea Baldo as chief executive, along with the emergency £10.75m share placing, announced late on Friday, “provides the company with a solid platform to execute a turnaround”. “In light of this, the board has concluded that the possible offer does not recognise the company’s substantial future potential value.
In addition, the board has been informed that Challice is supportive of the company’s strategy.” Frasers has been given a “put up or shut up” deadline of 5pm on 28 October to announce a firm intention to make an offer for Mulberry, or walk away. Mulberry shares closed at 124p on Monday after hitting a low of 102p earlier in th.