Ted Baker PLC (LSE:TED) said it is prepared to consider sensible offers for the business after a third potential bidder threw its hat into the ring.
The fashion firm rejected two unsolicited bid approaches in late March, one of which was from Sycamore Partners Management, which has since come back with an improved its bid proposal. Meanwhile, the fashion firm has also received an expression of interest from a third possible bidder.
In view of the interest expressed by potential offerors, and having consulted its major shareholders, the board has decided to conduct an orderly process to establish whether there is a bidder prepared to offer a value that the board considers attractive relative to the standalone prospects of Ted Baker as a listed company.
Rumours in the City suggested Sycamore’s first sighting shot placed a value of around £200mln on the company. Shares in the company rose 15% this morning, lifting the stock market capitalisation of the company to £259mln.
The stock market statement also contained some ritual “talking up the business” with the board saying it believes the business is well-positioned to create significant value for shareholders.
“Despite the impact of Omicron on the fourth quarter of the year to 29 January 2022, Ted Baker delivered group sales growth of 35 per cent. compared with last year, and trading margin improved strongly demonstrating the progress the company is making in re-establishing its premium brand positioning. Ted Baker has a strong balance sheet, with a net cash position at year-end, and ample liquidity headroom to continue to grow,” the company said.
Nevertheless, the company has been in private equity’s sights since its share price tanked in late November, with the company squeezed by both internal and external issues.
Under the stewardship of Rachel Osborne, the chief financial officer turned chief executive at the start of the pandemic, the company has been set on executing its six-point transformation plan, although lockdowns meant progress wasn’t as quick as initially hoped.
The transformational plan targeted stabilising the business following periods of instability, with three chief executives in a year and multiple profit warnings on the back of the allegations of sexual harassment against ex-boss Ray Kelvin, before pushing forward with growth.
READ Ted Baker: ready to push for growth?
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