Source: AFP
Shares in troubled British clothing brand Superdry fell on Tuesday after its chief executive ruled out a takeover of the troubled company.
Superdry previously said in February that co-founder and chief executive Julian Dunkerton was exploring the possibility of making a bid, sending its share price soaring at the time.
But shares fell more than 50 percent to 14.14 pence in afternoon London deals on Tuesday after Dunkerton said he had decided against such a move.
“The company notes (the) announcement by Julian Dunkerton that he does not intend to make a bid for Superdry,” the company said in a statement after the discussions.
The group and Dunkerton “have concluded that a takeover offer … is unlikely to be productive for shareholders”.
Dunkerton was still in discussions with the business about other methods of financial support, including the possible underwriting of a share capital increase, he added.
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The chain’s share price has fallen more than 90 percent in value over the past five years.
“Dunkerton has withdrawn his bid to take the troubled retailer private, meaning Superdry now faces the prospect of raising capital at a deep discount to stay afloat,” noted AJ Bell investment director Russ Mould.
“Investors now seem to be dumping the stock to get back what they can, even if it means crystallizing a loss. In the absence of someone else throwing their hat in the ring and trying to buy the business, we can probably say goodbye to Superdry as a listed entity’.
The group had revealed in January that sales had fallen by almost 25 per cent in the six months to October on a year earlier, blaming the “challenging” retail environment.
Source: AFP