Department stores and sports goods group Frasers is seeking to take control of Norwegian sports specialist XXL, where it’s already the second biggest shareholder.
Frasers Group has revealed its intention to make a voluntary offer for XXL in a deal valuing it at NOK 246m (£17.4m).
Frasers’ move follows a shareholder vote against a rights issue by XXL and a subsequent alternative proposal that Frasers believes is of “questionable” legality, and the implementation of which “will be extremely detrimental to both Frasers and the other minority holders of XXL shares”.
Frasers, which holds 32.5% of the voting rights and 25.8% of the shares of XXL said it has the “relevant experience to have a chance at saving XXL”.
Frasers chief executive Michael Murray said: “Our strategic vision and industry experience position us uniquely to help XXL navigate its current challenges. We are committed to ensuring that XXL reaches its full potential.”
XXL has reportedly suffered from lack of access to adequate levels of appropriate stock which has hit sales volumes. Frasers said if its offer is acceped, it is willing to support XXL to deal with the stock shortage, provide it with products and brands, and “ease” its cash requirements.
Frasers said it’s willing to consign up to NOK 500 million of stock on a delayed payment basis, and XXL would not have to repay Frasers until the stock is sold.
The group is also open to discussing with XXL “alternative means of providing liquidity, such as the purchase and consignment of XXL’s existing stock orders from suppliers”.
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