Ideal Shopping Direct could now be a possible bid target as the turnaround for the home shopping group gains traction, said Singer Capital analyst Matthew McEachran.
Ahead of the group’s trading update, expected on June 15, he has forecast a £3.9m rise in pre-tax profits this year to £5m, £1.5m of which relates to its recent acquisition of gardening retailer Lead The Good Life.
He said an approach for Ideal Shopping Direct cannot be ruled out. “It is a unique format and has a good position in craft - so it could make a sensible strategic acquisition for a home shopping or mass merchant retailer especially if they are able to take out some of the overhead,” he said.
Ideal is “an interesting business with a strong new management team”, headed up by chief executive Mike Hancox and chairman Paul Wright, said McEachran. “Early signs of revenue growth that have been emerging are encouraging,” he said.