British retailer Mulberry has announced that it is evaluating Frasers’ second bid for the firm, despite a lack of interest from its majority shareholder, Challice.
In light of Frasers’ £111m bid, the luxury brand is “working with advisers to consider the company’s position,” it said, despite Challice’s public snub of the deal.
Challice, which is backed by a Singapore-based firm owned by billionaires Christina Ong and Ong Beng Seng, owns a 56 per cent stake in the luxury retailer.
Frasers, with only a 37 per cent stake in the company, would need the support of Challice to launch a successful bid for Mulberry.
Mike Ashley’s group launched its first bid of £83m on 1 October after it was snubbed from Mulberry’s £10m capital raise with Challice, adding that Mulberry’s “unabating difficulties” were part of the reason it announced the indicative bid.
“Frasers will not accept another Debenhams situation where a perfectly viable business is run into administration,” it said. Frasers lost £150m after Debenhams collapsed in 2021.
After Mulberry rejected the bid as “not recognis[ing] the company’s substantial future potential value”, Frasers followed up with a second bid of £111m on 11 October.
Challice then announced it had “no interest in… selling its Mulberry Shares to Frasers”, adding that it was an “inopportune time” for Mulberry to be sold.
“Challice hopes that by making its position clear, Frasers will be encouraged to announce that it does not intend to make an offer for Mulberry,” the company said.
Under City rules, Frasers has until 5pm on 28 October to either announce a firm intention to make an offer for Mulberry or announce that it does not intend to make an offer.
The deal may be further complicated by the fact that Challice owner Ong Beng Seng was last week charged in connection with an ex-government minister who was sentenced to jail for receiving gifts from the billionaire.