Bonmarche Holdings PLC (LON:BON) has rebuffed a £5.7mln takeover offer from retail tycoon Philip Day, saying it “materially undervalues” the business and its future prospects.
Day, who owns the Edinburgh Woollen Mill, took a 52.4% stake in the fashion retailer for 11.445p per share earlier this month through his holding company Spectre.
The deal, which represented a 36% discount to the previous day’s closing share price, triggered a mandatory cash offer for the rest of the shares.
Day has offered the same price for the remaining shares.
Bonmarche told shareholders to take no action on the full takeover bid. The group said it has sought to engage with Day to discuss the future plans for the business.
“The board would also like to take this opportunity to inform shareholders that, in light of trading in Q4 of the financial year ended 31 March 2019 and prior to the announcement of the mandatory cash offer, it had been planning a number of cost reduction actions across the group and anticipates starting the implementation of these shortly,” the retailer said.
In March, Bonmarche issued its third profit warning in six months. The retailer expects an underlying pre-tax loss of between £5mln to £6mln for the year to March.