Currys, a British retailer of electronics, has declined a revised acquisition proposal of £742m from American investment firm Elliott Advisors.
According to a statement to the London Stock Exchange, Currys announced that Elliott, the owner of Waterstones book stores and with a significant stake in Wasabi restaurant chain, has increased its bid to 67p per share from the previous 62p per share bid made in mid-February.
The company’s board unanimously rejected the recent offer, which was initially reported by Sky News, “because it greatly underestimated the value of the company and its potential for growth.”
Following Elliott’s initial proposal, JD.com, a Chinese e-commerce company, also stated that they were contemplating making a bid for Currys. The previous week, the largest investor in the retailer, Redwheel, supported the board’s choice to decline Elliott’s offer, reasoning that it held a higher value.
Currys stock prices dropped by 1% following the rejection of their second offer, resulting in a market valuation of approximately £746m.
Elliott has gained a reputation as a shareholder who actively advocates for changes within companies, including drugmaker GSK and housebuilder Taylor Wimpey. It has made notable investments in the past, such as Italian football club AC Milan, although it later sold its ownership. Additionally, Elliott has obtained various retail businesses through its private equity investments.
In 2014, Currys, formed by the combination of Carphone Warehouse and Dixons Retail, was launched amidst a challenging industry. This union united popular brands such as Currys, PC World, and Carphone Warehouse. The company has a long history, tracing back to 1884, when Henry Curry established it as a manufacturer of bicycles. Over the years, it expanded into selling toys, gramophones, and radios. In 1927, it went public on the London Stock Exchange. Currently, Currys is part of the FTSE 250, a list of medium-sized businesses.
In 2021, Currys changed its approach to combine its four operated brands, which were PC World, Dixons, and Carphone Warehouse, into a unified master brand.
The UK-based company Currys has over 15,000 employees and operates approximately 300 stores. Due to the pandemic, it shut down its 531 Carphone Warehouse stores in the UK, resulting in 2,900 job losses. In November, the company made a £175m agreement to sell its Greek division.
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According to UK takeover regulations, Elliott is required to declare a definite plan to propose a deal for Currys by 5pm on 16 March, or withdraw their interest.
Elliott refused to provide a statement.
Source: theguardian.com
