Mulberry rejects ‘untenable’ £111m takeover provide from Frasers

Mulberry is currently undergoing a £10.8million fundraising plan in efforts to withstand a sharp slowdown in luxury demand

Mulberry has rejected a second takeover bid from retail giant Frasers, dismissing the offer as ‘untenable’ after pushback from a major investor. 

Mike Ashley’s retail empire made an improved 150p per share cash offer for the luxury group earlier this month, valuing Mulberry at £111million.

But Challice Limited, which owns 56.4 per cent of Mulberry shares, said shortly after the bid it would refuse to sell to Frasers.

Mulberry, which is currently undergoing a £10.8million fundraising plan in efforts to withstand a sharp slowdown in luxury demand, on Tuesday formally rejected the offer.

It said the bid was ‘untenable’ and Mulberry would instead ‘focus its attention on driving the commercial performance of the business’.

Mulberry reiterated is commitment to its capital raising strategy and debt facility announced last month under new boss Andrea Baldo, which it said would ‘put the group on a firm footing to ensure we are well set up for future growth’.

It added that Frasers has participated in the fundraising and is ‘supportive of maintaining the value of the Mulberry brand’.

Frasers has previously said it would look to engage with Challice ‘directly’ over its refusal to sell. Mulberry was not a part of these conversations. 

City rules give the Sports Direct owner, which owns 37 per cent of Mulberry shares, until 5pm on 28 October to make another bid or walk away.

Frasers shares were up 0.6 per cent to 815p in early trading. 

Mulberry shares shed 3.9 per cent, bringing losses over the last 12 months to around 30 per cent.