Austin Reed in takeover frame

British clothing retailer Austin Reed today emerged as the target of a £42m (€62m) buy-out bid from the owners of a finance and property investment firm.

The high street chain, also home to the Country Casuals brand now known as CC, is in the sights of major shareholders Guy Naggar and Peter Klimt who own Dawnay Day Corporate Finance.

The pair has asked the Austin Reed board to consider a price of 131p per share, representing a 10% premium on yesterday’s closing share price of 119p. It is also a 25% premium on the average share price over the last 12 months.

Mr Naggar and Mr Klimt have lifted their stake in the company over the last two years to 29.88% – they would have been forced to make a bid if the shareholding lifted above 30%.

Dawnay Day stressed today’s announcement did not necessarily mean a firm offer for the company would be tabled and refused to say when a decision would be made either way.

The Austin Reed brand operates from 61 stores and 33 concessions in the UK, while CC operates had 63 sites and 124 concessions.

The group, which has a flagship store in London’s Regent Street, posted profits of £228,000 (€335,000) in the year to January 28 – against losses of £1.9m (€2.8m) previously.