Superdry shares plummet as CEO rules out takeover
Source: AFP
Shares in troubled British clothing brand Superdry dived Tuesday after its chief executive ruled out a takeover of the troubled company.
Superdry had previously stated in February that co-founder and CEO Julian Dunkerton was exploring the possibility of making an offer, sending its share price soaring at the time.
However, shares tumbled more than 50 percent to 14.14 pence in London afternoon deals on Tuesday after Dunkerton indicated he had decided against such a move.
"The company notes (the) announcement from Julian Dunkerton that he does not intend to make an offer for Superdry," the firm said in a statement following discussions.
The group and Dunkerton "have together concluded that a takeover offer ... is unlikely to deliver an outcome for shareholders".
Dunkerton was still talking with the business about other methods of financial support, including potentially underwriting an equity raise, it added.
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The chain's share price has slumped by more than 90 percent in value over the last five years.
"Dunkerton has withdrawn his attempt to take the troubled retailer private which means Superdry now faces the prospect of having to conduct a heavily discounted fundraising to stay alive," noted AJ Bell investment director Russ Mould.
"Investors now appear to be dumping the stock to get back anything they can, even if it means crystalising a loss. In the absence of someone else throwing their hat in the ring and trying to buy the business, we can probably wave goodbye to Superdry as a listed entity."
The group had revealed in January that sales had tanked almost 25 percent in the six months to October from a year earlier, blaming the "challenging" retail environment.
Source: AFP
