US investment firm Elliott Advisors has walked away from making a takeover bid for Currys after being rejected by the retailer's board “multiple times”.
It had initially proposed an offer that valued the electricals chain at £700m, and then raised it to £757m. But Currys rebuffed the approaches, stating that they “significantly undervalued” the business.
Currys could still receive a bid from China's JD.com, which said last month it was mulling an offer for the firm. Currys has more than 800 stores globally and employs 28,000 people. In the UK, it operates about 300 stores with 15,000 staff.
Elliott, which owns UK bookseller Waterstones, said on Monday that it had made attempts to engage with the board of Currys, but had now chosen to back off. It said it was “not in an informed position to make an improved offer for Currys on the basis of the public information available to it”.
“Elliott therefore confirms it does not intend to make an offer for Currys,” a statement added.
The rising cost of living in the past couple of years has hit many retailers as consumers cut back on spending, and Currys said last month that underlying sales had fallen 3% over the key Christmas trading period.
Despite this, the company increased its profit forecast for the year, helped by cost cuts and higher profit margins on some of its services. Analysts have also noted that Currys' share price appears low given its market share and profitability, which has made the firm attractive to investors.
Following the news that Elliott Advisors had called off its takeover interest, Curry's share price fell by 8% in early trading on Monday. When JD.com confirmed its interest in Currys last month, the Chinese e-commerce group said it was “in the very preliminary stages” of evaluating a possible bid.
Under UK takeover rules, JD.com has until 18 March to make a formal offer or walk away from the deal.
— CutC by bbc.com
