Currys PLC (LSE:CURY) has rejected an unsolicited £700 million takeover offer from the UK arm of the American activist investment firm Elliot Advisors.
"The board of Currys considered the proposal, together with its financial advisors, and concluded that it significantly undervalued the company and its future prospects," the electrical retailer told investors.
Currys finished last week with a market valuation of £533 million based on its closing share price of 47.08p.
Under UK takeover rules, Elliot now has until March 16 to sweeten and formalise the preliminary and conditional offer.
If the bid were to be successful, Currys, which owns 800 stores, would be added to a retail portfolio that also includes Waterstones in the UK and Barnes & Noble in the US.
Chinese e-commerce giant JD.com has also confirmed a newspaper report at the weekend that it is considering a takeover offer for the retailer.
“In response to the recent press speculation regarding Currys, JD.com confirms that it is in the very preliminary stages of evaluating a possible transaction that may include a cash offer for the entire issued share capital of Currys,” said JD.com Inc (NASDAQ:JD) in a statement.
“There can be no certainty that any offer will ultimately be made for Currys, nor as to the terms on which any offer might be made. A further announcement will be made if and when appropriate.
Under City rules, JD.com must now announce a firm intention to bid for Currys or announce that it does not intend to make an offer, by 18 March.
Shares in Curry's leapt 31% to 61.84p in early trading.