Brand licensing conglomerate Authentic Brands Group (ABG), which includes Reebok, Aeropostale, Forever 21 and roughly 50 other labels, is considering a bid for British fashion retailer Ted Baker, according to unnamed London sources in a Sky News report out over the weekend.
ABG is among “several parties” considering making an offer for Ted Baker and has been talking to the company’s financial advisers, the report says, with ABG reported to be part of the process that included a bid deadline last Thursday (April 21) for non-binding offers.
Ted Baker rejected a pair of bids from private equity firm Sycamore Partners last month that put the company’s value in the range of 250 million pounds (almost $320 million) but announced in early April that it was open to offers.
Ted Baker’s sales grew 35% last year and company officials said this month that it was “well-positioned to create significant value for shareholders,” the report says. The initial phase of the company’s formal sale process would be based on public information and focus “on those parties who understand and value the full potential of this unique brand,” according to the report.
The second stage, it said, would involve “a select number of parties,” the report says.
The company released a statement in early April saying its board “has decided to conduct an orderly process to establish whether there is a bidder prepared to offer a value that the Board considers attractive relative to the standalone prospects of Ted Baker as a listed company.”
Ted Baker rejected Sycamore’s takeover offers saying the proposals did not “compensate shareholders for the significant upside that can be delivered by Ted Baker as a listed company.”
Sycamore’s first offer proposed 130 pence per share. The investor followed that by raising its offer to 137.5 pence per share, which would have valued Ted Baker at 253.8 million pounds (about $333.7 million).
Sycamore later sent an “improved proposal,” and Ted Baker also saw other “unsolicited third-party bid interest.”
“The Board believes the business is well-positioned to create significant value for shareholders,” the company statement said. The company said it “intends to conduct a targeted process, focused on those parties who understand and value the full potential of this unique brand.”