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Accent Group has rejected Frasers’ “unsolicited, highly opportunistic” £116m takeover bid, arguing that the offer does not reflect the group’s future prospects.
The all-cash offer would have seen Frasers, which already holds 22.9% of shares in Accent and makes it its largest shareholder, take ownership of the remaining shares for A$316m (£116m).
Following receipt of the offer, the Accent board established an independent board committee (IBC) to consider and respond to the offer. The IBC concluded it would instruct shareholders to reject the offer.
The group said the offer “represents no premium” and warned that Frasers aims to secure additional board representation and influence without offering a fair financial incentive to shareholders.
It added that the timing of the bid coincides with a period of cyclical weakness across the discretionary consumer retail sector and therefore is “highly opportunistic”.
The board said the price ignores future upside from its 2030 strategic growth plan, which targets $1.9bn (£991m) in sales and a 9% earnings margin across approximately 950 stores.
Conflicts of interest were also highlighted regarding Accent’s Sports Direct business in Australia and New Zealand. Frasers operates the global brand and serves as a commercial counterparty, meaning its corporate interests may conflict with those of ordinary investors.
A letter from Lawrence Myers, chairman of Accent Group, stated: “Having carefully considered the offer, with the benefit of advice from its financial and legal advisers, the IBC has concluded that the offer is opportunistic and is materially inadequate. The IBC unanimously recommends that you REJECT the offer.
“Your board and management remain focused on executing Accent’s strategy and delivering value for all Accent Shareholders. Accent is the largest retailer and distributor of performance and lifestyle footwear, apparel and accessories in Australia and New Zealand.”
He added: “With approximately 900 stores and a national distribution network, extensive and longstanding strategic brand partnerships with a proven ability to grow brands, and a highly experienced management team, Accent is a uniquely strategic retail platform positioned to drive growth and value over the medium term. We are confident in Accent’s prospects, and we do not believe the offer reflects them.”
Frasers has been contacted for comment.
