Luxury handbag maker Mulberry has rejected a takeover approach from Mike Ashley's Frasers Group valuing the firm at £83 million. The struggling British fashion brand said it believes the possible offer from Frasers, which was revealed on Monday, "does not recognise the company's substantial future potential value". Mulberry said it had discussed the approach with its majority shareholder, Singapore-based Challice, which is controlled by billionaire Ong Beng Seng and his wife Christina.
The Somerset-based firm put faith in its recently appointed chief executive Andrea Baldo to drive a turnaround and said it would also stick with the plans for a capital raising. It said this "provides the company with a solid platform to execute a turnaround and, ultimately, to deliver best value for all Mulberry shareholders." Mulberry added: "In addition, the board has been informed that Challice is supportive of the company's strategy and has no interest in supporting the possible offer.
" The company said it would instead look to hold talks with Frasers over a "pro rata participation" in the cash-call. Frasers Group, which owns Sports Direct and already has a 37% stake in Mulberry, said on Monday it had put forward an approach worth 130p per share, valuing the stake in the company it does not own at £52.4 million.
It comes after Mulberry said on Friday that it needed to raise more than £10 million after slumping to a significant loss for the past year. The luxury fashion firm reported a �.