Who is look­ing to con­nect with French Con­nec­tion?

Faded fash­ion brand has put it­self up for sale, send­ing the shares storm­ing higher

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Em­bat­tled fash­ion brand French Con­nec­tion (FCCN) has con­firmed me­dia spec­u­la­tion (8 Oct) it is con­sid­er­ing strate­gic op­tions in­clud­ing putting it­self up for sale. As we write the news has sent the shares surg­ing higher to 54p, within sight of 52-week highs.

Founder, chair­man and CEO Stephen Marks has re­port­edly ap­proached bid­ders to off­load his near42% stake and French Con­nec­tion is in an of­fer pe­riod; any deal to buy Marks’ hold­ing would likely trig­ger a manda­tory of­fer for the en­tire en­ter­prise.

Fight­ing to ar­rest like-for-like sales de­clines and bat­tle its way back to prof­itabil­ity amid cut-throat com­pe­ti­tion, French Con­nec­tion has long been viewed as a value trap for in­vestors.

A sale of the busi­ness could be the re­quired cat­a­lyst to un­lock this value.

A buyer would have to ex­tri­cate the re­tailer from leases and fur­ther stream­line the brick and mor­tar es­tate but there look to be op­por­tu­ni­ties to ex­pand the whole­sale and li­cenc­ing parts of the busi­ness.

Mike Ash­ley’s Sports Di­rect In­ter­na­tional (SPD) has a 27% stake in French Con­nec­tion, al­though it is un­clear if Ash­ley is one of the in­ter­ested par­ties.

Last year, French Con­nec­tion re­ceived an un­so­licited bid from an un­named US group, but the suitor ul­ti­mately walked away from a deal.

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