Gunnar Sigurdsson, chief executive of the Icelandic investment house, told Retail Week that the stakebuilding, via investment vehicle Unity, did not presage a takeover. However, the said French Connection remained “an interesting asset” with “interesting value”.
French Connection has long been considered a potential Baugur bid target by observers. Founder and chief executive Stephen Marks owns a majority stake, but has been reluctant to sell.
In the six months to July 31, pre-tax losses at French Connection improved from£3.6 million to£2.5 million, but like-for-likes fell 1.6 per cent as menswear and its Toast brand failed to make an impression.
Baugur is, however, expected to launch a bid for luxury US department store Saks, in which it has an 8 per cent stake, as part of a joint venture with Dubai-based Landmark Group.
Landmark is run by Mickey Jagtiani, who was linked to the potential sale of New Look earlier this year.
Separately, Baugur and womenswear retailer Hobbs have both said they will consider buying fashion retailer LK Bennett, although no price tag has been put on the sale.
LK Bennett, which was put up for sale last week, is understood to be seeking£150 million.
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