Iconic firm on market
AN online shopping business whose largest shareholder is Mike Ashley’s Frasers Group has put itself on the market.
Studio Retail Group, which is based at Church Bridge House in Henry Street, Church, announced the move as part of a strategy review.
And it comes after Frasers, which owns around 37 per cent of the Lancashire company, said the group was “misunderstood by the market and as a consequence, significantly undervalued”.
Formerly called Findel, the company said a sale is just one of a number of options that are being considered. It comes after Frasers attempted a takeover of the firm in 2019.
Frasers has now urged the company to launch an overhaul.
Studio Retail said the move also has the support of its second largest shareholder, Schroders, but confirmed it is not yet in talks with any potential bidders, BusinessLive reports.
Combined, Frasers and Schroders have a stake totalling roughly 56 per cent.
Studio Retail said it received a letter from Frasers in October saying that it believed the group is “significantly undervalued”, adding that “although this may be fixable over the long term, the group should conduct a strategic review”.
In light of the letter, a forthcoming change in chief executive, its decision not to sell its education arm and talks with Schroders, it has now decided to go ahead with a possible sale.
Studio Retail said: “The board has now determined that it is an appropriate point to undertake a comprehensive review of the strategic options open to it in order to maximise value for shareholders. These options include a sale of the group which will be conducted under the framework of a ‘formal sale process’ in accordance with the Takeover Code.”
In April 2019, the Accrington business rejected a £139million takeover bid from Mike Ashley’s Frasers, saying it undervalued the company.
Frasers-owned Sports Direct had run trials selling its clothing brands online via Studio after first investing in the group in 2015, before gradually building up its stake in the firm. And Frasers has been steadily buying up parts of the high street in recent years and is currently in talks over a possible rescue deal for collapsed department store Debenhams.
Studio Retail sells fashion, homeware and gifts on its Studio.co.uk website, but it is also the second largest supplier of equipment and supplies to schools.
It’s half-year results show a 52 per cent rise in underlying pre-tax profits to £17.7million in the six months to September 25 thanks to a boom in online shopping during the pandemic, which has seen the high street closed for a number of months in 2020.