Apr 4, 2022
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Ted Baker puts itself up for sale after more bidders emerge

Apr 4, 2022

Ted Baker announced on Monday that it has launched a formal sale process following additional interest after unsolicited bids from private equity group Sycamore Partners.

Ted Baker

The news sent the company's shares over 14% higher on the London Stock Exchange and valued it at £271 million.

The company said it had rejected the first two offers that Sycamore made on the grounds that they undervalued the business. But it added that it has now received an “improved proposal” from the group and that since Sycamore originally emerged as being interested in buying the company, it has “also received other unsolicited third-party bid interest”.

The board stressed that it “believes the business is well positioned to create significant value for shareholders” — which could be interpreted both as applying to those shareholders who are the investors that own it as a listed company today, as well as a private equity group or other retailer that might own it in future.  

And it said that it continues to make good progress with its transformation and that despite the impact of Omicron on Q4, it delivered sales growth of 35% along with a much better trading margin.

Its statement to the London Stock Exchange also explained its reasoning for the official sale process. “In view of the interest expressed by potential offerors, and having consulted its major shareholders, the 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,” it said.

It didn’t specify what that value might be and it's clear that if it doesn't achieve the right price, it's prepared to continue as an independent, listed business.

The firm has agreed various points with the UK Takeover Panel and one of them is that parties interested in making a proposal will not be required to be publicly identified.

Ted Baker added that it “intends to conduct a targeted process, focused on those parties who understand and value the full potential of this unique brand”. The first phase of the process is expected to be based on public information only and interested parties will be invited to submit non-binding indicative offers to its financial advisers, Evercore and Blackdown Partners.

The company hasn’t yet spoken to Sycamore about whether it wants to be part of this process.

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