The major shareholder Frasers Group wants to take over the Swabian fashion manufacturer HUGO BOSS. This is an offer worth billions.
Frasers wants to offer 38 euros per Boss share as part of a voluntary public takeover offer, as the company announced on Wednesday evening after the stock market closed. The offer applies to all shares that Frasers Group does not already own. Most recently, the British said they had a direct share of a good 26 percent. The HUGO BOSS share listed in the MDAX jumped after trading.
After the announcement, it temporarily rose by more than six percent to over 38 euros on the Tradegate trading platform. She decided to start XETRA trading at a price of 36.46 euros – about the same as at the beginning of the year. Over the past twelve months, the paper has lost almost 9 percent. In pre-market Tradegate trading on Thursday, the increase was only 1.29 percent at 38.50 euros.
Analyst Chiara Battistini from JPMorgan wrote in an initial reaction that the 38 euros offered did not seem particularly attractive. They only included a four percent premium on the current XETRA closing price. However, she doesn’t see any other obvious interested parties. Before the Frasers offer was announced, Battistini also observed a comparatively high short quota for the share – i.e. a number of investors who had bet on a falling price through short sales.
There had recently been disagreements between the major shareholder and the top management of HUGO BOSS. Frasers withdrew its trust in the chairman of the supervisory board, Stephan Sturm, in December. Among other things, there was a dispute over the dividend payment. However, Frasers backpedaled on Tuesday this week and expressed support for Sturm and dividend policies.
According to its own information on Wednesday, Frasers also has other financial instruments for HUGO BOSS shares. The British had sold so-called put options, meaning that shareholders and option holders could have offered them shares at a certain price. If the threshold of 30 percent of the shares was exceeded, Frasers would have had to make a mandatory offer to the remaining shareholders anyway. The British said Frasers had decided on a voluntary offer to consolidate its investment in HUGO BOSS.
Frasers is majority owned by British billionaire Mike Ashley, who already has several fashion ventures under his wing. Frasers also owns the online retailer Sports Direct. Frasers is a long-term investor in HUGO BOSS and continues to stand by Supervisory Board Chairman Sturm and CEO Daniel Grieder, it said.
Frasers would have to fork out around 2 billion euros for the remaining 74 percent of HUGO BOSS shares. The entire high-end tailor would be valued at around 2.7 billion euros. The offer is not subject to a minimum threshold. Regulators still need to approve the deal.
METZINGEN (dpa-AFX)
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