Frasers Group, led by Mike Ashley, has made a bold move to acquire the struggling British luxury brand Mulberry with an £83 million offer. Mulberry, known for its iconic leather goods, has faced financial difficulties, posting a pre-tax loss of £34.1 million last year. However, Mulberry’s board rejected the bid, stating that the offer undervalued the company’s future potential.
Majority shareholder Challice Limited also refused the bid, leaving the path forward uncertain. Frasers, which already owns 37% of Mulberry, now faces a 28 October deadline to make a formal offer. The company’s rejection has raised concerns about Mulberry’s financial stability and the potential for further takeover attempts.
Frasers has been strategically expanding into the luxury sector, having increased its stakes in brands like Hugo Boss and acquiring Matches in 2023. Analysts believe Frasers sees long-term value in Mulberry’s integration with its existing retail portfolio, which includes stores like Flannels.
Despite the rejection, both sides face challenges. Mulberry is grappling with declining sales, impacted by the post-Brexit environment and a broader luxury market slowdown. Frasers, on the other hand, must decide whether to improve its offer or let the opportunity slip away.
The coming months will reveal if Frasers pushes ahead with a higher bid, or if Mulberry’s management team can turn the company’s fortunes around without a takeover.
