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Last updated: November 12, 2008 4:21 pm
Sir Philip Green, the owner of BHS and Topshop, has become the largest shareholder in Moss Bros, the men’s wear chain, paying £6.7m for the 28.5 per cent stake controlled by Baugur, the Icelandic investment group.
In a prelude to a possible takeover bid for Moss Bros, Sir Philip’s Warbeck Holding Company said in a stock exchange announcement on Wednesday that it was “considering its alternatives”, although there was no guarantee he would bid.
The price, which equates to 24.95p a share, represents a 58.5 per cent premium to Tuesday’s closing price. The shares soared to 26¾p in late trading, an increase of 11p, or 70 per cent, valuing the company at £25.3m.
The stake purchase by Sir Philip from the Baugur-controlled Unity Investments follows his attempt last month to gain control of Baugur’s entire portfolio by buying the £1bn-£2bn of debt in the investment group that is now held by the Icelandic government after the collapse of the country’s banking system.
The entrepreneur’s offer to do a quick transaction at a deep discount to the debt’s face value was stymied by the Icelandic government, which has appointed bankers to consider all options, including a sale to Sir Philip or another party, or holding on to the debt.
Baugur indicated in February that it was willing to pay 42p a share for Moss Bros before walking away in April. Proceeds from the sale of the stake, which was held via contracts for difference, will go to Kaupthing Luxembourg as will a part of a Unity-owned stake in French Connection, the fashion chain.
The sales will spark speculation that other public stakes held via Unity Investments, including part of Debenhams, the department store group, could also be liquidated.
However, a spokesman said Moss Bros “was no longer a strategic holding” for Baugur and the decision to sell was taken because of the premium offered by Sir Philip. He emphasised it did not herald the start of a wider sale of assets.
Unity is owned by a consortium of investors led by Baugur and including Kevin Stanford, the co-founder of Karen Millen.
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