Challice rejects Frasers’ new offer for Mulberry, urging the company to withdraw and stating that the timing is not right.
Challice Ltd., the majority owner of the accessory brand Mulberry, has rejected a new acquisition offer from the Frasers group, urging the company to pull back. Frasers, which had increased its cash offer from £83 million to £111 million, faces a firm refusal from Challice, which argues that the timing is not suitable for a sale.
Challice, which controls 56.4% of Mulberry, describes Frasers as a “supportive minority shareholder” but is not interested in selling its shares or facilitating the acquisition offer. Challice’s board indicates that, without its support, any attempt by Frasers to acquire the company would be futile.
The situation is tense, as Frasers needs to secure more than 50% of the issued shares to succeed. Additionally, there have been criticisms regarding Frasers’ management of luxury brands, having acquired Matches at a reduced price, only to place it into administration shortly afterward.
Meanwhile, Mulberry faces significant challenges, reporting a 4% drop in sales and a pre-tax loss of £34.1 million. Challice hopes that the clarity of its position will lead Frasers to abandon its acquisition attempt.
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