Britain's Mike Ashley deserts short-lived bid for Patisserie Valerie
(Adds details, analyst, source comment)
By Noor Zainab Hussain
Feb 11 (Reuters) - British retail tycoon Mike Ashley's
Sports Direct has withdrawn its offer to buy scandal-hit
British cafe chain owner Patisserie Holdings, a source
told Reuters on Monday.
Sports Direct on Friday offered to buy Patisserie out of
administration to enlarge an empire stretching from department
stores and sofa shops to lingerie, but wrote to Patisserie
administrators KPMG saying it lacked the information required to
continue bidding, British media reported on Sunday.
Patisserie Valerie was plunged into crisis in October after
its owner uncovered accounting irregularities. It hired KPMG in
a last-ditch attempt to save the company, which traces its roots
back to a shop founded 93 years ago.
The source told Reuters that Sports Direct, Britain's
biggest sporting goods retailer, was given the opportunity to
access detailed financial information.
Chris Wootton, deputy chief financial officer for Sports
Direct, wrote to KPMG partner David Costley-Wood, to say it had
made an offer in excess of 15 million pounds ($19 million), only
to be told it would need to raise this by as much as 2 million
pounds, the Financial Times reported.
"The fact the administrators felt confident enough to reject
Sport Direct's advances does at least indicate there is a
competitive bidding process taking place, and that bodes well
for the price tag on its (Patisserie's) assets," Laith Khalaf,
Senior Analyst, Hargreaves Lansdown, said in an email.
Media reports said Costa, the coffee chain bought by
Coca-Cola last year, was also interested in Patisserie's
assets. Patisserie Holdings' administrators, KPMG, declined to
comment on the situation and Sports Direct was not immediately
available to comment on its proposal.
Ashley, who also owns English Premier League soccer club
Newcastle United, made his name building budget chain Sports
Direct and has more recently bought stakes in, or assets from,
British retail businesses that have struggled to cope with
challenges ranging from the rise of internet shopping to higher
business property taxes and sluggish consumer spending.
These businesses have included department store groups
Debenhams and House of Fraser, home furnishings firm
Sofa.com, Evans Cycles and Lingerie brand Agent Provocateur.
($1 = 0.7756 pounds)
(Reporting by Noor Zainab Hussain in Bengaluru; Editing by
Jason Neely and Alexander Smith)
First Published: 2019-02-11 11:31:21
Updated 2019-02-11 12:14:53
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