Mulberry Group PLC (LON:MUL) has noted that Mike Ashley's Frasers Group PLC (LON:FRAS) does not intend to make a takeover offer for the fashion firm, so the offer period is ended.
The Sports Direct and House of Fraser owner said late on Thursday that it did not plan to snap up the posh bags maker.
READ: Frasers Group ups stake in Mulberry Group to over a third
The offer period began last month after Ashley’s group raised its stake in Mulberry to 36.82%, having snapped up 22mln shares for 150p each.
The FTSE 250 company first bought a 12.5% stake in Mulberry in February and increased that to 29.61% earlier in November.
Because Asian firm Challice owns 56% of Mulberry's issued share capital, Frasers Group did not have to make a mandatory cash offer to other shareholders after reaching the 30% threshold as would otherwise be the case under London Stock Exchange rules.
The market may have expected a takeover offer, however, considering that Frasers has been pursuing an 'elevation strategy' to drive an increasingly premium offering via several of its retail brands across fashion, sports and lifestyle which aims to lift earnings in the medium term.
But AIM-listed Mulberry has had a tough time during the coronavirus pandemic, as have many other luxury brands, and expects sales to fall by 35% and 61% in its retail and wholesale & franchise businesses, respectively, in the year to next March.
“We continue to make significant progress in building Mulberry as a sustainable global luxury brand, creating value for all our stakeholders,” said the fashion designer’s chairman Godfrey Davis in a statement on Friday.
“This is focused around our omni-channel network and market-leading digital platform; increasing our Asian footprint; and a relentless focus on innovation and sustainability, offering our customers beautiful products, made to last in our Somerset factories," he added.
Shares in Mulberry and Frasers both dipped 1% to 202p and 476.8p respectively on Friday morning.
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