Frasers Group’s £13.6m offer for MySale becomes unconditional after retailer’s stake surpasses 50%
- Frasers Group already owns Sports Direct, Jack Wills and French Connection
- The Derbyshire-based firm now controls shares constituting 50.6% of MySale
- It often acquires financially-troubled companies at bargain-basement prices
Frasers Group’s MySale takeover offer has become unconditional after the retailer secured a more than 50 per cent stake in the company.
The fashion retailer, which is the parent company of Sports Direct, Jack Wills and French Connection, has been building up a stake in the e-commerce firm since the summer as part of measures to expand its international presence.
It became the largest shareholder in the Australian business, which sells excess stock it buys from apparel retailers in Europe, when it acquired a 28.7 per cent ‘strategic investment’ three months ago.
Purchase: Frasers Group, whose majority owner is Mike Ashley, has been building up a stake in MySale since the summer as part of measures to expand its international presence
A £13.6million takeover bid was then made by Frasers for the remaining shares it did not own, a proposal initially rebuffed by the MySale board for what it deemed to be undervaluing its prospects.
After receiving support from MySale’s co-founders, Jamie Jackson and his brother Carl Jackson, who resigned as chairman, the deal then became a mandatory offer.
Having bought further stock yesterday, Frasers said it now controls or has received valid acceptances for shares constituting 50.6 per cent of the company, meaning the buyout proposal has turned unconditional.
Should the Derbyshire-based group obtain at least 90 per cent of the retailer’s shares before the mandatory bid expires at the start of next month, it has vowed to make a compulsory acquisition of the remaining equity.
The FTSE 100 business told investors on Tuesday that it ‘intends to continue to acquire additional MySale shares by means of market or other purchases and in accordance with the Takeover Code’.
It said: ‘MySale shareholders who wish to transfer their holdings of MySale shares to Frasers may do so either by means of a market sale or by accepting the mandatory offer via the acceptance procedure outlined in this announcement.’
Frasers’ pursuit of the business has put its majority owner Mike Ashley against retail magnate Sir Philip Green, whose wife Tina owns a 15 per cent stake in MySale through her offshore vehicle Shelton Capital Management.
Ashley and Green became the largest shareholders in the flash-sale specialist following its listing on the London Stock Exchange in 2014, but Ashley decided to sell his investment five years.
Were Green to sell his stake at 2p-per-share, as per Frasers’ asking price, he would be making a significant loss given that he bought MySale shares when they were valued at 226p.
The move for MySale comes amid a frenzy of takeovers by Frasers, which often buys up financially-troubled companies at bargain-basement prices.
Women’s fashion retailer Missguided, Australian luxury footwear and streetwear seller Sneakerboy and digital retailer Studio Retail Group have all been bought out of administration by the business.
Frasers Group shares were up 0.6 per cent to £6.62 this morning, although their value has declined by over 15 per cent so far this year.