French Connection sold to consortium led by second-largest shareholder
Clothing brand French Connection has been sold to a consortium including its second-largest shareholder in a deal valuing it at £29m.
The firm – which operates 150 stores and concessions across the world – has accepted a 30p-per-share offer, after struggling with years of losses.
It represented a 30 per cent premium to the share price when the bid was first revealed last month.
The buyer group was made up of UK-based apparel industry entrepreneurs Apinder Singh Ghura and Amarjit Singh Grewal, as well as holding company KJR Brothers Ltd.
Founder Stephen Marks is to step down from his role as chairman once the sale was completed and will remain the top shareholder with a 41.5 per cent stake.
The pandemic had been the most challenging period for the firm, founded in the 1970s, Marks said last year.
Last year, French Connection reported group revenue of £23.9m, down 53.1 per cent from £51m in 2019 , due to the impact of Covid store closures.
The brand’s underlying loss widened from £3.6m in 2019 to £12.2m in 2020, driven by a sharp drop in sales.
Wholesale revenue plunged 49.3 per cent to £13.8m due to the closure of stores.
The retailer’s share price jumped 15 per cent after it confirmed it had received an offer at the 30p-per-share price last week, an increase on the previous close price of 23p.
There were hopes of a takeover by investment firms Spotlight Brands and Gordon Brothers but the early stage offer later fell through.