Mulberry’s largest shareholder has dismissed a revised takeover bid from Frasers Group, labelling the move a distraction at a critical time for the struggling luxury handbag brand.
Challice, which holds a 56.1% stake in Mulberry and is controlled by Singaporean billionaires Ong Beng Seng and Christina Ong, has made it clear that it has no intention of selling to Frasers. The group, led by Mike Ashley, raised its offer to 150p per share after its initial bid of 130p was rejected. Frasers already owns 36.8% of Mulberry.
Challice’s firm stance signals that without its backing, Frasers will struggle to gain control of more than 50% of the company. The Ongs hope their refusal will dissuade Frasers from further pursuit, calling the bid “inopportune” and a disruption to the company’s management as they work through a turnaround plan.
The Bath-based brand, famous for its Bayswater handbags, recently posted a £34 million pre-tax loss and has seen a drop in sales, reflecting challenges in the global luxury market. However, Mulberry is confident in its recovery, pointing to the appointment of new CEO Andrea Baldo and a £10.75 million share placing to stabilise the business.
Frasers, however, insists it can steer the brand back to profitability, aiming to avoid what it calls “another Debenhams situation.” Frasers faces a deadline of 5pm on October 28 to either make a formal offer or walk away.