After receiving a £191-million takeover bid from a member of Alliance’s controlling family, the owner of Simply Be & Jacamo joins the list of UK struggling stocks that have been delisted from London’s Aim junior market.
The shares of N Brown jumped more than 43% on news that Joshua Alliance would pay 40p for each share he did not already hold.
Alliance currently owns 6.6% of N Brown. The other members of the family including Lord Alliance, former executive chairman own the controlling 53.4%. Lord Alliance is Lord Alliance’s son, Joshua, age 35.
N Brown stated that Mike Ashley’s Frasers Group (which owns 20,3 percent of N Brown) planned to vote for the takeover. Frasers stake is valued at £38.77million.
Falcon 24 Topco is the vehicle Alliance will use to purchase N Brown. Falcon 24 Topco believes that the group “does not benefit from being listed on Aim while having to pay significant costs associated with their listing.”
The article suggested that N Brown had suffered on the junior London Stock Exchange because of its shareholder structure, low trading liquidity, and limited UK fund managers’ appetite for consumer small-cap stocks. Aim has delisted a number of companies this year, which adds to the concerns over the future of City’s finance sector.
N. Brown, founded by James David Williams in 1859, is a Manchester-based company. It has a lucrative niche for clothing “larger people” through its brands Simply Be and Jacamo. Ambrose Wilson and Fashion World are also part of its portfolio. Premier Man and Fashion World sell clothes specifically designed for older women.
Davina McAll and Amanda Holden, and Freddie Flintoff were once its ambassadors.
The shares of the group, listed at the London Stock Exchange in 1972, have dropped by 70 percent in the last five years. The shares closed Thursday at 38 3/4p, down from 150p a year ago. In April, they dropped to just 14p.
Joshua Alliance stated that the proposed deal would help N Brown accelerate its long-term potential for growth. We will be able achieve this potential more effectively away from public markets.
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