Green declares 'High Street war' on M&S

Retail tycoon Philip Green is preparing to wage a high street war on Marks & Spencer after dropping his £9.1bn (€13.6bn) takeover bid.

Retail tycoon Philip Green is preparing to wage a high street war on Marks & Spencer after dropping his £9.1bn (€13.6bn) takeover bid.

As chief executive Stuart Rose gets to grips with his task of turning around the struggling retailer, Mr Green fired a warning shot, saying his group would now do battle in a high street “judgment day” with M&S.

Speaking on BBC’s Newsnight Mr Green said: “The big winners are going to be the customers.

"What I am fired up about is making sure our own businesses – Bhs, Top Shop, Dorothy Perkins – trade their socks off.

“And they are going to have us breathing down their neck in every street in every shopping centre in the UK. And that’s where I am going to be fired up. It is going to get my best shot. And we will see who is the best retailer.”

He added: “Customers can look forward to great value, great product in stores they want to shop in.

"They will be able to decide where they want to shop and whose got the best offer.

“There will be a very clear judgment day in every street in the country – we are all represented. We’ll see where they do their shopping.”

Asked if he would try again should Mr Rose fail to turn the embattled group around, he said: “I am not looking for a job.”

In the wake of Mr Green’s decision to drop his bid, M&S chairman Paul Myners said the board had “every confidence” in the ability of Mr Rose and the team.

He said: “As a board, we are focused on improving the performance of Marks & Spencer and delivering the long-term value that we have identified for the benefit of our shareholders.

“Stuart Rose and the team are fully committed to the task and we have every confidence in their ability to succeed.”

In a statement issued last night, the board of Marks & Spencer said it “believed and continues to believe” that 400p (€6) per share undervalued the group and its prospects significantly.

Yesterday, M&S had defied calls from its largest shareholder to allow Mr Green to complete due diligence ahead of the bid.

The billionaire retailer said yesterday that despite “continuing support” from Brandes and other shareholders, it had been concluded “Revival will not gain the cooperation of the board of M&S to provide it access to the information necessary for Revival to make its offer, including the necessary meeting with the pension trustees, by August 6”.

United States-based Brandes, which has an 11.7% stake in M&S, had previously issued a statement urging the retailer to consider Mr Green’s final proposal of 400p (€6) a share.

It had already pledged to back a formal offer from bid vehicle Revival Acquisitions, while the bid had also attracted support from Schroder Investment Management Ltd, which has 1.2% of shares, and others controlling a total of 21.1% of shares.

But Mr Green’s statement said that the decision to withdraw came following yesterday’s AGM statement and conversations with Mr Myners.

Mr Green’s statement said: “Since it has never been Revival’s intention to disrupt the business of M&S, Revival is making this announcement promptly and wishes to thank the many M&S employees and shareholders who have expressed their support.”

The statement added that Revival reserved the right to make or participate in an offer within the next six months in the event that the board of M&S agreed to recommend an offer or a third party announces a firm intention to make an offer for M&S.

At the start of the company’s annual meeting yesterday, Mr Myners had said it would be wrong to allow Mr Green to carry out due diligence when it still believed his £9.1bn (€13.6bn) proposal undervalued the company.

He vowed to help M&S to restore growth in sales and profits, and backed the vision Mr Rose outlined on Monday.

This blueprint included a £2.3bn (€3.4bn) windfall for shareholders and the sale of financial services arm M&S Money for £762m (€1.1bn).

It appeared the stance of the M&S board had won the support of private investors who own 20% of shares in the high-street giant.

Many shareholders attending the company meeting said Mr Rose should be given time to turn around the struggling retailer.

Arcadia and Bhs owner Mr Green announced he was considering a takeover offer for M&S on May 27, which was followed four days later by the announcement of boardroom changes, when Mr Rose was brought in to replace chief executive Roger Holmes.

On June 3 Mr Green made his first takeover approach, offering £7bn (€10.5bn) in cash and a 25% stake in bid vehicle Revival Acquisitions.

On June 16, a second possible offer of 370p (€5.50) per share was also rejected by the M&S board.

His final offer of £9.1bn (€13.6bn) was made on July 7 – and was again rejected by the group, which said it continued to undervalue the group and its prospects.

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