Mysale directors reject takeover bid from Frasers Group, chair steps down

Australian-based fashion marketplace Mysale announced Friday that its directors have rejected a takeover bid by British retail giant Frasers Group.

Directors at Mysale said the offer did not “reflect an adequate value or premium for control of Mysale and therefore undervalues Mysale and its prospects”.

The board has therefore recommended that shareholders reject the offer.

Frasers Group, whose portfolio includes Flannels, Sports Direct, House of Fraser, and Jack Wills, made a cash offer to buy Mysale last month at a price of 2 pence per share.

The offer valued the share capital of Mysale not held by Frasers Group at approximately 13.6 million pounds.

Acquisition hungry Frasers Group became the biggest shareholder in Mysale when it bought a 28.7 percent stake in the business in June.

It said a takeover would allow the group to grow its presence in Australia and the surrounding regions, and would also help its portfolio of brands to clear their end of line products via Mysale’s established clearance channel.

For the eight weeks to August 30, Mysale’s gross merchandise volume (GMV) was down 34 percent year-on-year, while revenue was down 45 percent, with the company citing Covid-19-related lockdowns in Australia and New Zealand in the previous corresponding period and continuing macro-economic headwinds.

Mysale chair steps down

Mysale also announced Friday that non-executive chair Carl Jackson has retired from the company’s board with immediate effect “as a result of conflicts arising in his role as a director” and “his personal position as a substantial shareholder” in the company.

Frasers Group has made a number of acquisitions in recent months as it continues to expand its high street empire.

This year alone, the group has bought fast fashion rivals I Saw It First and Missguided, as well as British value retailer Studio Retail.

A report by Sky News earlier this month also said Frasers Group was one of the few remaining bidders for British tailor Gieves & Hawkes.

The group swung to a pre-tax profit of 344.8 million pounds in the year to April 24, compared to a loss of 39.9 million pounds a year earlier.

Group revenue excluding acquisitions in that period increased 30.1 percent to 4.75 billion pounds as it benefited from shoppers returning to physical stores following the end of lockdown restrictions.

Based on its results, Frasers Group upped its FY23 outlook, though it warned that the “significant increase in general running costs” amid rising inflation and widespread supply chain challenges could persist.