Frasers ups stake in AO World to 25%

Mike Ashley’s Frasers Group has revealed it has increased its stake in fashion retailer  Brown to 25.01%, according to the latest holding documents filed by the company. 

It now holds 145,148,997 voting rights in the company. 

The news comes as the electrical retailer AO raised its full-year forecast to between £39m and £44m, as profits before tax rose 30% year-on-year to £17m for the six months to 30 September. 

It said group revenues are also now expected to hit between £1.09bn and £1.13bn, as AO saw half-year revenue growth of 13% in its B2C Retail category despite a tough market over the summer. 

Recently, Frasers also increased its stake in Asos from 24.2% to 25.1%, making it the second largest shareholder in the company. 

The news follows after Asos’ largest shareholder, Danish billionaire Anders Holch Povlsen’s company Bestseller, increased its stake to 28%, sparking speculation about a potential private takeover.

Povlsen is now only 2% away from the 30% threshold, which would require him to make a formal offer for the company under UK acquisition laws.

The reports come as Frasers also looks to expand its portfolio overseas as reports suggest it intends to make a mandatory offer for Norwegian sporting goods retailer XXL ASA, despite withdrawing its offer to buy more shares in the group only last month. 

Frasers has now been allocated 21,637,943 of shares of XXL’s rights issue, while 777,289 shares will be issued as compensation for Frasers Group’s guarantee in the issue. 

Following the move, Frasers will own a total of 28,776,451 shares in the group, or 32.9% of all shares and around 40.8% of the voting shares, crossing the 1/3 threshold under the Norwegian Securities Trading Act, which triggers an obligation to make a bid for the remaining shares in the company.