British sportswear and fashion group Frasers has today launched a bid to takeover Norwegian sporting goods retailer XXL ASA, saying it did not agree with the Oslo-listed company's plan to issue more shares.
Frasers, majority owned by Mike Ashley, said it was offering 10 NOK ($0.9044) a share for the equity it does not own in XXL - a premium of 25% over its closing price of 8 NOK yesterday and valuing the group at NOK 246.4 million ($22.3m).
The UK retailer already holds 25.8% of the issued share capital of XXL, which also operates in Sweden, Finland, Denmark and Austria.
"The proposed Alternative Rights Issue is wrong, its legality is questionable and its implementation will be extremely detrimental to both Frasers and the other minority holders," Frasers said.
It said XXL should not be asking shareholders for further funding when "it has not articulated any clear plan to address and resolve the root causes of its persistent problems."
Frasers has been expanding overseas with recent deals in the Netherlands, Australia/New Zealand and Africa.
However, it cut its profit guidance yesterday blaming a drop in consumer confidence caused by the UK government's budget.
Frasers said it was now forecasting adjusted pretax profit for its 2024/25 financial year of £550-600m compared to its previous guidance of £575-625m and £545mmade in 2023/24.
It made £299.2m on the same basis in its first half to October 27, down 1.5% year-on-year. Revenue fell 8.3% to £2.54 billion.
Frasers said it expected to incur at least £50m of incremental costs going into its 2025/26 year as a result of the budget.
"We are working hard to mitigate these in order to maintain our profitable growth ambitions," it said.
