Good morning!

I hope you are all feeling refreshed and energetic. Plenty to chew on today.

Today's report includes:



Laura Ashley Holdings (LON:ALY)

  • Share price: 3.76p (+16%)
  • No. of shares: 728 million
  • Market cap: £27 million

Update on media speculation

We discussed Laura Ashley last week, and my conclusion was:

"Not worth dabbling in this until there is a sale/liquidation planned, as the brand seems to be dying a slow death under current management."

Three business days later and the company is suddenly at the centre of takeover speculation!

The Sunday Telegraph reported over the weekend that Michael Flacks "is to approach Laura Ashley's Malaysian controlling shareholders in the hope of taking it private and reviving it".

Today, the Chairman of LA says that no approach has been made and also that "as major shareholders, we have no intention of divesting our shareholding".

The group of controlling shareholders is centred around Khoo Kay Peng and his MUI Group (Malaysian United Industries), with c. 60% of the shares.

Speculating on takeovers is very difficult, in my experience. In this instance, a takeover bid has not yet been made and the controlling shareholders are indicating that their stake is not for sale. So we have some fairly obvious reasons for caution.

A controlling shareholder is always a huge roadblock when it comes to getting a change of direction, e.g. see French Connection (LON:FCCN) which should have been transformed many years ago. My comments last week were on the basis that the current controlling shareholders might some day want to move on.

Buyer background check - Looking into the background of the rumoured bidder, I see that he does have a track record in this sort of activity and so the rumoured bid is probably not just a publicity stunt.

In 2012, he led…

Unlock the rest of this Article in 15 seconds

or Unlock with your email

Already have an account?
Login here