Icelandic giant Baugur looms large over House of Fraser
The group said it received an approach, which may or may not lead to a takeover offer. This followed reports over the weekend that the board held an emergency meeting on Friday.
Baugur sent House of Fraser’s shares to an eight-year high last month after buying a 9.48% stake in the company for around £29 million (€41.78 million).
The move prompted a frenzy of bid speculation and sent the group’s shares up 8% to 135p, valuing it at £321m (€465m), although they have since fallen back and closed at 119p on Friday, making the group worth £281m (€407m).
Baugur has built a retail empire in Britain including supermarket chain Iceland and toy store Hamleys.
In addition, it owns clothing brands stocked by House of Fraser such as Karen Millen and Whistles.
In January, Baugur said it remained on the acquisition trail after making profits of £257m (€372m) in 2005. The company built up an assets base worth £1.33 billion (€1.9 billion) by the end of last year. The turnover of firms in which Baugur is a major shareholder totalled £8.7bn (€12.6bn) last year, dwarfing the economy of its native Iceland.
House of Fraser owns 60 stores around Britain and also has a branch in Dublin. It posted a 4.6% rise in underlying profits last year to £27.3m (€39.5m).
