Burberry Group PLC (LSE:BRBY) shares ticked higher on Monday following a report that it could be a takeover target of puffer jacket maker Moncler.
According to industry blog Miss Tweed, Moncler could be considering launching a bid for Burberry in order to create an “outdoor specialist giant”.
Several sources had indicated that Bernard Arnault, chief executive of LVMH which recently invested in Moncler, was keen to push such a deal, a report said.
This would come as Burberry navigates downtrodden demand for luxury goods under new chief executive Joshua Schulman and a recent exit from the FTSE 100.
Morningstar analyst Jelena Sokolova said Monday that such a move by Moncler would see it secure a“promising deal with significant upside”.
“However, challenges remain with their [Burberry] low share of sales in iconic outerwear, and also increased competition in the outerwear from the likes of Moncler but also more affordable independents like Barbour,” Sokolova added.
“Moncler's expertise in outerwear and its marketing prowess could be a game-changer for Burberry, steering the brand back to its core strengths.”
Shares jumped 5.2% to 854.2p on Monday.