Frasers Group, led by Mike Ashley, has confirmed it will not pursue a bid for Mulberry, after the iconic British luxury brand rejected its two previous cash offers earlier this month.
The first bid, launched on 1 October at £83m, was dismissed by Mulberry as undervaluing the brand. A subsequent offer on 10 October at £111m, proposing to acquire the remaining shares at 150 pence per share, was rebuffed by Frasers yesterday as “untenable.”
The stabs at a takeover stemmed partly from Frasers’ exclusion from a recent capital raise, despite later participating, coupled with what it termed Mulberry’s “unabating difficulties”.
But, in a statement today, Frasers said it is choosing to end the offer period “in the absence of proper engagement from the Mulberry Board”.
The company reiterated its “long-term” support for Mulberry but said there is an urgent need for a credible business strategy from management.
It said it has grown “increasingly concerned over the governance of Mulberry, the apparent lack of a commercial plan against a backdrop of increasing market headwinds, and critically, the financial position in which Mulberry currently finds itself.”
Frasers, which is a major Mulberry shareholder with a 37 per cent stake, added that the outcome is “disappointing” and it hopes the company will “engage positively” on a Frasers appointee to the Mulberry Board.
It was also angered by Mulberry’s exclusive dealings with other majority owner Challice in recent financial decisions, for example the emergency subscription of £10m announced in September.
In September, Mulberry announced a slide in profit – reporting a pre-tax loss of £34.1m having made a pre-tax profit of £13.2m in 2023.
Mulberry could not immediately be reached for comment.