Zalando drops after offer for About You

ABOUT YOU Holding SE

11/12/2024 09:35

(Updates share move, adds analyst comments)
    ** Shares in Zalando  ZALG.DE  fall around 6% after the
online fashion retailer said it struck a deal to buy rival group
About You  YOUG.DE  for 1.1 billion euros ($1.2 billion)
    ** Zalando is well positioned for investments and
consolidation but there is a risk of post-merger integration,
says Morningstar's analyst Jelena Sokolova
        ** There are also some concerns that the deal is
overpriced, potentially diminishing scope for shareholder
returns, which may explain the negative price reaction to the
announcement, Sokolova adds
  
    ** "From a strategic point of view, it makes a lot of sense
- especially in the group's B2B segment," analysts at Baader say
    ** However, they expect Zalando's short-term profitability
to suffer as About You is a loss-making business
    ** Zalando's stock is amongst the worst performers on the
pan-European STOXX 600  .STOXX  index
    ** About You shares jump around 64% to their highest since
August 2023 and if gains hold, they will see their best day ever
    
($1 = 0.9501 euros)

 (Reporting by Paolo Laudani)
 ((Paolo.laudani@thomsonreuters.com))