Troubled fashion firm Bonmarche snubs £5.7m takeover bid by billionaire tycoon Philip Day claiming it ‘undervalues’ the 300-store chain
- Bonmarche has rejected a £5.7m takeover bid tabled by tycoon Philip Day
- It said it ‘materially undervalues’ the firm, which has a market value of £7.7m
- Bonmarche also said today that it is embarking on a cost-cutting mission
Bonmarche – a troubled retail chain selling clothing aimed at women aged over 50 – has turned its nose up at a £5.7million takeover offer tabled by High Street tycoon Philip Day.
The Yorkshire-based company claims that Day’s bid ‘materially undervalues’ the firm.
Day, the retail mogul behind The Edinburgh Woollen Mill Group, bought up more than half of Bonmarche’s shares through holding company Spectre earlier this month, which meant he was obliged to make a formal takeover approach.
Bonmarche was founded in 1982 and is based in Yorkshire. Its controlling shareholder is Philip Day, who made an offer for the chain last week
But the 300-store business told shareholders on Friday to ‘take no action’ in relation to their shares, explaining that the offer was too low.
Day’s bid of 11.445p per share represents a significant discount from today’s share price of 15.50.
Just five years ago Bonmarche was worth nearly £100million. Today it has a market value of £7.7million.
Bruising losses: Bonmarche shares slumped in December 2018 when it issued a pre-Christmas profit warning
‘In view of Spectre’s position as the majority shareholder in Bonmarche, the board has sought to engage with Philip Day to discuss the future plans for the business for the benefits of all stakeholders,’ the company said.
Bonmarche added that it is embarking on a cost-cutting mission to help stem some of the decay caused by dismal trading in November and March.
Day, who also owns Peacocks, Proquip, Austin Reed, Country Casuals, Jaeger and Jacques Vert, said that if his bid was successful he would carefully review Bonmarche’s large store estate with a view to closing under-performing sites, cutting jobs and slashing the rent bill.
Philip Day owns Peacocks Austin Reed, Jaeger, Jacques Vert and Jane Norman through his Edinburgh Woollen Mill group
It has been a torrid year for Bonmarche which has seen its shares crumble as it warned on profits three times in just six months.
It complained of a significant sales slowdown at the start of March, and a dismal November, and expects to make a loss of up to £6million this year after resorting to heavy discounting.