The board of struggling fashion brand French Connection are considering the sale of the retailer after receiving approaches from two companies.
In a note to the City this morning, French Connection confirmed it had received early takeover approaches from Spotlight Brands in conjunction with Gordon Brothers International and rival brand Go Global Retail in conjunction with HMJ International.
French Connection made the announcement after its share price jumped 40% yesterday due to speculation, though the once-popular brand is only valued at around £15.2m.
The retailer said discussions between it and the two suitors were at an early stage and it sought to downplay any certainty around one or both actually bidding to take over French Connection.
Both Spotlight and Go Global Retail have until 5pm today to declare a firm interest in acquiring French Connection, though the deadline can be extended.
French Connection has been struggling in recent years. In July, after the first wave of the pandemic, it turned to investment and turnaround specialist Hilco for an injection of liquidity.
At its most recent financial update in October, French Connection reported its toughest ever trading period as losses spiralled.
The business recorded an underlying loss of £12.2m in the six months to July 31 compared with a loss of £3.6m during the same period the previous year, which it attributed to a “significant decline in sales”.
French Connection’s sales plummeted by more than half, down 53% year on year to £23.9m, “predominantly owing to the impact of the Covid-19 pandemic”.
No comments yet