Value clothing retailer Ethel Austin, which this week disclosed bumper profits, is in potential sale talks only 17 months after a£45 million management buy-out.
Paul Johnson, investment director at Lloyds Development Capital (LDC), which backed the MBO, said talks were continuing. 'We received an unsolicited approach earlier this year. Discussions are ongoing. The shareholders are considering all options and a disposal is only one. We could sell, we could float or we could continue to hold and grow the business,' he said.
He expects significant growth at the chain over the next two to three years.
Ethel Austin chief executive Phil Hoskinson confirmed the bid approach, but said he was concentrating on delivering 'superb trading performance'.
In the year to August 31, operating profits surged 158 per cent to£12.5 million. Hoskinson attributed the performance to the creation of more excitement in traditionally strong areas, such as childrenswear and underwear.
He plans to open 30 to 40 stores in the current financial year. At present there are 250 outlets.
Turnover climbed 13 per cent to£138 million and like-for-like sales rose 8.3 per cent. Hoskinson said current trading was promising, with like-for-like sales in September and October up 10 per cent.
Retail Knowledge Bank research director Robert Clark speculated that Ethel Austin might be bought by another venture capitalist.
'I can't think of too many trade sales. It could be Peacocks, but it is feasting on Bonmarche at the moment,' he said
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