LONDON — Mike Ashley’s Frasers Group has raised its stake in Mulberry to just below the threshold where the company would be required to make a takeover offer for the brand, which is majority-owned by the Singapore-based Ong Beng Seng and Christina Ong.
Frasers Group, formerly known as Sports Direct International, confirmed this week in a stock market filing that it has upped its stake to 29.65 percent, from 12.54 percent. The group took its initial stake in Mulberry in February, when it acquired the 12.54 percent.
In addition to Frasers, Ashley owns the British retailers Sports Direct, the House of Fraser department store chain, fashion retailer Flannels and Jack Wills. He specializes in buying stakes in distressed companies, or companies such as Mulberry, which sell through his retail chains.
Michael Murray, Frasers Group head of elevation, said Friday the company was “proud to show our commitment to this growing relationship between Mulberry and the Frasers Group by increasing our investment in this iconic British brand. We have been working with Mulberry for a number of years in House of Fraser, and are looking forward to launching Mulberry into Flannels in the coming weeks.”
London is locked down for the next four weeks, until Dec. 2, so all store deliveries have been delayed.
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A spokeswoman for Mulberry declined to comment on the share increase.
The Ongs own 56 percent of the company, with the rest of the shares listed on the London Stock Exchange.
Mulberry has just emerged from a period of major restructuring, having laid off about 25 percent of its staff and making the decision not to renew its ready-to-wear and footwear licenses with Onward Luxury Group.
Mulberry has also waved goodbye to its creative director Johnny Coca, who left the company, as planned, in March. Coca has since joined Louis Vuitton.
“We’ve had a full reorganization of the business, and we’re on a good track. We’re confident about the future,” said chief executive officer Thierry Andretta in a telephone interview last month.
Andretta also said that Mulberry, which saw sales and profits tumble in fiscal 2020 due to already shaky U.K. sales and the onset of COVID-19, has begun to see a small ray of light at the end of the tunnel.
Trading since the start of the current financial period, which started at the end of of March, was ahead of expectations, with group revenue down 29 percent year-over-year between March 29 and Sept. 26.
Revenue in the 52 weeks to March 28 was down 10.2 percent to 149.3 million pounds.
The brand has also been pushing hard on the sustainability front: It has launched the Portobello tote, its first fully sustainable bag. The bag is made from grain leather from a gold-rated tannery; the material is a byproduct of food production and the style comes unlined, with little or no hardware.
Andretta was among the executives given the Positive Change accolade at the 2019 Fashion Awards in London in December, and he has been a driving force behind the sustainability drive.
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