Moss Bros takeover is back on as Brigadier withdraws review request
May 26, 2020
It looks like the £22.6 million takeover of Moss Bros will go ahead after the previously reluctant bidder withdrew its attempt to abandon the deal.
Brigadier Acquisition Company, an entity linked to the owner of Crew Clothing, had made the deal with Moss Bros only shortly before the UK lockdown began. It then quickly requested that the Takeover Panel allow it to get out of the deal.
But last week, the Takeover Panel ruled that the change in circumstances due to the lockdown wasn't enough to abandon the agreement. It said the coronavirus had already been declared to be a pandemic by the World Health Organization when the two companies reached agreement for the takeover so, essentially, Brigadier should have known there were risks.
The Takeover Panel on Tuesday morning said that “Brigadier has now withdrawn its request for a review and, accordingly, the Panel Executive's ruling stands”.
Moss Bros has had a chequered history in recent years with the company’s declining fortunse being reflected in its share price. Exactly two years ago, the shares were valued at 116p each. Prior to Brigadier’s news release that it would be taking over the company, they had fallen to 13.7p each. They’re currently trading at just over 21p.
The share price had risen sharply on news of the takeover, but has been volatile in the past couple of weeks as it emerged that Brigadier was trying to get out of the deal.
It's understandable why Moss Bros's board had agreed to be taken over given the challenges that it has faced of late. The board also said that the impact of the coronavirus influenced it in being determined for the purchase to go ahead.
Moss Bros has been working on a turnaround but other retailers doing so have gone under in the face of the pandemic. Oasis/Warehouse had apparently been seeing an upturn prior to the lockdown and even Laura Ashley had said that its sales rose in January. But both businesses were dealt a crushing blow by the closure of their physical stores and it's unclear how able Moss Bros would have been to bounce back as an independent company.
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