Troubled fashion retailer French Connection rejected a private equity takeover bid in January that would have valued the firm at 41.4p a share.
The bid was at a premium of 18% to the share price at the time, and with the shares currently trading at only a little over 5p each, that premium would now be many times higher. At its current share price, the firm has a market capitalization of less than £5 million.
The bid, which was originally placed in December, came from ex-All Saints/USC chief Stephen Craig in partnership with two private equity firms, according to reports.
But the following month, the board decided not to recommend the bid to shareholders. The news has only emerged now due to the expiry of a non-disclosure agreement.
French Connection had earlier put itself up for sale, but in January said it was no longer in a formal sale process. It also said it wanted to focus on a self-generated turnaround with its store portfolio being right-sized and more investment in online.
The company made a loss of £2.9 million in the year to January but while the previous year had seen it making profits, the figure was only £0.8 million.
It has seen many years of weak performance that have caused its share price to decline. French Connection shares changed hands at a high of 487p each around 16 years ago, but had fallen to 74p a decade later. In more recent times, their highest level was 61p in November 2018, but they’ve been declining steadily since April last year, before falling off a cliff in the wake of the coronavirus crisis.