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The majority shareholder in UK luxury handbag maker Mulberry has told Mike Ashley’s Frasers Group that it is not interested in selling the business, in a clear rejection of its two conditional offers to date.
After Frasers made a second proposal on Friday, valuing Mulberry at £111mn, Challice said in a statement on Sunday that it had “no interest in . . . selling its Mulberry shares to Frasers”.
Challice has been the majority owner of Mulberry since 2002 and has a 56.4 per cent stake in the business. Challice is controlled by billionaire property tycoon Ong Beng Seng and his wife Christina.
The statement said that Challice was “very supportive” of Mulberry and its management team and that while it “appreciates that Frasers is a supportive minority Mulberry shareholder” it believes that it is “an inopportune time for Mulberry to be sold”.
“Challice hopes that by making its position clear, Frasers will be encouraged to announce that it does not intend to make an offer for Mulberry,” it added.
Mulberry shares closed at 112.50p on Friday before the latest Frasers bid of 150p. The stock is down more than 40 per cent in the past year.
Frasers made its first conditional offer, which implied a valuation of £83mn, last month. It has owned shares in Mulberry since 2020 and has a stake of around 37 per cent.
Under UK takeover rules, it has until October 28 to either make a formal offer or walk away.
Mulberry sank to an annual pre-tax loss of £34mn in the year ended March 31, from a £13mn profit the previous year. Revenues fell 4 per cent to £153mn.
It appointed chief executive Andrea Baldo in July to lead a turnaround of a company that has suffered as wealthy customers have cut their luxury spending.
Mulberry supplies the House of Fraser and Flannels department store chains that are both owned by Frasers.
Ashley stepped back from the FTSE 100 business in 2022, handing the reins to his son-in-law Michael Murray, who serves as its chief executive.
The company has a wide range of retail interests, ranging from its recent investment in UK ecommerce company THG to stakes in Hugo Boss, Asos, Boohoo, and white-goods seller AO World.
But its main profit engine remains sportswear retailer Sports Direct, which was founded by Ashley in 1982.
Earlier this month, Singapore charged Ong with two offences of abetting a former Singapore transport minister to obtain gifts and obstruct justice. Ong did not enter a plea, local media reported.