Shares of French Connection Group Plc (LON: FCCN) exploded 92.3% higher after the company revealed that it has received two acquisition offers from Spotlight Brands and Go Global Retail.
The fashion company that struggled throughout last year after the coronavirus pandemic led to the closure of most high street fashion stores is in the enviable position of choosing between two very qualified suitors.
Spotlight Brands is the company behind the Sweaty Betty activewear brand whose sales skyrocketed last year driven by demand for its home workout leggings as more people had to work out from home instead of the gym.
WELCOME BONUS - Free Share Bundle When You Invest £50!
Get up to £500 cashback for investing with IG.
Spotlight’s bid is backed by Gordon Brothers’ funding, a US advisory, lending and investment firm that has been in business since 1903 with an established track record of investing in the retail and consumer sector.
The other interested party is Go Global Retail, a brand investment platform that invests in fashion and retail brands based on a customer-centric approach. The firm currently operates the ModCloth women’s fashion store that designs and sells women’s clothing and accessories.
French Connection has given the two firm up to 5 PM UK time today to make a formal offer for the company or back out. Investors cheered the move as seen by the spike in the company’s share price, and it will be interesting to see how everything plays out.
The fashion company would have gotten a major lifeline if one of the two suitors acquired it. Both companies have been very successful during the coronavirus pandemic and have a good chance of revamping French Connection’s operations.
French Connection share price.
French Connection shares spiked 92.31% higher to trade at 30p having risen from Thursday’s closing price of 15.6p.