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Ted Baker stock up after reports of PE buyout
Posted on Monday, 22 July 2019 14:27
UK-based luxury clothing company Ted Baker could be a target for a private equity investor, according to the Sunday Times.

The paper reported that the firm’s founder, Ray Kelvin, said he could support a deal to acquire the business while keeping its current management team in place.

So far, Ted Baker has declined to comment on the news.

The company’s stock has been on the slide for some time; after posting a three-year high of GBP 32.14 on 12th March 2018, it has declined fairly consistently.

It finished the day at GBP 8.38 on Friday (20th July), thereby giving it a market capitalisation of GBP 373.45 million.

News of the potential private equity buyout saw an upturn in the group’s share price and stock was trading at GBP 9.43 as of 12:12 on 22nd July.

Ted Baker was founded in 1988 and describes itself as a global lifestyle brand offering menswear, womenswear and accessories.

It was headed by Kelvin, who is known for hiding his appearance in photos and currently owns 35.0 per cent of the business, as chief executive from its formation until his resignation in March of this year.

The founder stepped down over misconduct allegations levelled against him, in which colleagues alleged that he behaved inappropriately and made inappropriate comments.

These accusations, which Kelvin denies, came to light as part of a petition started by staff at the fashion house, who said there had been at least 50 recorded incidents of harassment, including enforced hugging and slow dancing.

Following the allegations, back in December, Ted Baker said an investigation would be carried out and Kelvin went on a voluntary leave of absence.

There have already been 311 deals targeting apparel manufacturing companies announced worldwide since the beginning of 2019, according to Zephyr, the M&A database published by Bureau van Dijk.

Of these, the largest was worth USD 1.34 billion and saw Yvonne Lo Choy Yuk Ching and Kenneth Lo Lok Fung agree to acquire an 80 per cent stake in Cayman Islands-headquartered Crystal International Group.

Other companies in the sector to have been targeted this year include Marks & Spencer, Moncler and Hanesbrands.

© Zephus Ltd