Ted Baker is on the verge of being taken over by a US consumer goods group which owns Reebok and an interest in David Beckham’s global brand.
Authentic Brands Group (ABG) is closing in on a £200m cut-price deal for the London-listed fashion retailer, according to Sky News.
It is currently preparing a 110p-a-share offer, with sources close to Ted Baker revealing an announcement finalising the deal could be made as soon as tomorrow morning.
This would represent a 20 per cent premium to Ted Baker’s closing share price on Monday of 93.1p, with the stock having rallied from just over 69p in early July.
However, it is a third lower than the roughly 160p-a-share price that ABG was preparing to offer as recently as May.
The reduced price that ABG appears to be willing to pay for one of Britain’s best-known retailers exposes gloomy sentiment towards high street brands, in an economy being hammered by inflation amid fears of an impending recession.
ABG was made preferred bidder for Ted Baker in early June, as first reported by Sky News.
As Ted Baker is running a formal sale process, takeover rules prohibiting a company from returning with a fresh bid within six months do not apply.
Run by prominent businessman Jamie Salter, ABG has been valued at nearly $13bn following the sale of “significant equity stakes” to CVC Capital Partners, the Six Nations Rugby shareholder, and HPS Investment Partners.
Its valuation has soared in recent years, after reportedly selling a controlling stake in August 2019 to a division of BlackRock, the world’s biggest asset manager, for $870m.
Other shareholders include the buyout firms General Atlantic and Lion Capital, and GIC, the Singaporean state investment fund.