Frasers Group has retracted its bid to acquire the remaining shares of Mulberry due to governance issues.
- The decision follows Mulberry’s board’s unanimous rejection of Frasers’ revised cash offer.
- Frasers’ offer of 150p per share was deemed “untenable” by Mulberry’s majority shareholder, Challice.
- Frasers expressed concerns regarding Mulberry’s governance, commercial strategy, and financial standing.
- In light of adversity, Frasers requested a representative on Mulberry’s board despite withdrawing the bid.
Frasers Group has officially announced its withdrawal from pursuing a complete acquisition of Mulberry, a prominent luxury handbag retailer. This action follows Mulberry’s board’s unanimous rejection of a revised cash proposal from Frasers, who currently own a 37% stake in the company. The offer, which valued Mulberry at £111 million, was for 150p per share—a price Challice, the majority shareholder with 56% ownership, refused to entertain. Challice indicated no interest in disposing of its shares or entering any agreement with Frasers concerning the potential offer.
Frasers labeled the board’s rejection as a “disappointing outcome” yet reiterated its long-term commitment to supporting Mulberry. The group voiced unease over Mulberry’s governance practices, highlighting an absence of a solid commercial strategy amidst challenging market conditions. Additionally, Frasers pointed to concerns regarding Mulberry’s current financial health.
A particular point of contention arose from the board’s interaction with Challice on significant matters, such as the recent emergency £10 million subscription, which Frasers found problematic. Consequently, although Frasers has retracted their bid, they have called for a representative from their side to be appointed to Mulberry’s board to ensure more balanced governance going forward.
The dynamics between Frasers and Mulberry underscore the complexities of corporate governance and shareholder interests.
