Rebels move to stop Moss Bros wedding
Family shareholders step up attack over chairman's acquiescence to Baugur bid. Lauren Mills reports
Sunday 09 March 2008
Moss Bros shareholder David Moss has lambas-ted Keith Hamill, the struggling retailer's chairman, for failing to defend the high-street chain against a £40m takeover offer.
Hamill is due to step down as chairman of Moss Bros – whose brands include Savoy Taylors Guild, Canali and Hugo Boss – in April. He had hoped to leave on a high note, completing the sale to Baugur. But the row over control is becoming increasingly bitter, with Moss, a member of the founding family and a major investor, furious about the way in which Hamill is conducting the sale.
"Hamill's reputation is best served by flogging the business and not being succeeded by a strong, retail-minded chairman who drives the changes that are required," he said on Friday.
But Hamill poured cold water on Moss's attack: "It has nothing to do with my position. This is about doing the right thing for the company and the shareholders."
Moss insists the founding Moss and Gee families want to achieve the best outcome possible. "We are not emotionally attached to this. We are not saying we will never sell. But we think this business is worth more and deserves a board able to stand up and say that."
However, Baugur, the Icelandic retail raider, is determined to press ahead with a formal bid. Members of the founding families, who between them own 26 per cent of Moss Bros, believe the 42p-a-share offer undervalues the business.
"We are talking about a company with £150m of sales, £16m cash in the bank, no debt, no pension liabilities and a collection of well-known brands. It is worth twice what is being offered," said one insider.
In a move to scotch Baugur's plans, Michael Gee, a member of the Cecil Gee clan, whose chain became part of Moss Bros in 1989, is trying to raise funds to buy out its stake. He reckons the Icelandic investment fund would sell two-thirds of its 29 per cent holding in Moss Bros at around 50p a share. Last week he approached HSBC for backing. The outcome of the talks is not yet known.
There is certainly a rising tide of City sentiment that believes Baugur may turn from buyer to seller. "There is a sense they have overstretched themselves," said a City banker.
For the moment Baugur is keeping its cards close to its chest. The acquisitive investor, which already owns swathes of the high street from Woolworths to Oasis to Hamleys, is keen to be seen as a player in the mergers and acquisitions market. With the Icelandic economy causing concern, doubts are growing about the firepower of its banks.
Moody's, the credit agency, recently downgraded its ratings for the country's three largest banks – Kaupthing, Landsbanki and Glitnir – citing concerns about the quality of their assets after years of rapid growth.
While Baugur often teams up with such banks, other City sources believe the com-pany is determined enough to fund a bid out of its own pockets. So even if the families find a way to raise the cash, they reckon Baugur is not a seller at anything close to 50p a share.
"Why would they sell a stake at an effective loss when they may be able to buy the company cheaply, turn it round and make a profit out of it?" asked one retail analyst.
Certainly a deal this size is small fry to Baugur. Yet it is worth doing. The Icelanders plan to increase capital expenditure at the company, edit its brands and improve sourcing. They hope to revive the former glories of Moss bros– such as when shares soared after Prince Charles announced his engagement to Lady Diana Spencer, on the belief that wedding guests would hire their suits from Moss Bros.
Moss believes changes should have been initiated by the current management, regardless of ownership.
"It is an overdone myth that change can only be accomplished in the private arena. Moss Bros needs to buy better product, manage the brands better and take the business more upmarket. The board should get on with it."
Hamill disagrees. "It is generally accepted that strategic changes are easier in a company if it has gone private. It is also generally accepted it is difficult to operate a listed company below a certain size."
Culinary experts in The Netherlands thought it was 'fresh' and 'tasty'
Of all the computers Apple has ever made there’s only one that Steve Jobs had to sell his car to finance
Marvel has released first teaser trailer week early after it leaked online
- 1 As an ex prostitute, I urge all the political parties to commit to the Sex Buyer Law
- 2 Nokia no more: Microsoft drops once-ubiquitous mobile name – in favour of its Lumia brand
- 3 Renee Zellweger on plastic surgery: 'I'm living a fulfilling life and I'm thrilled that perhaps it shows'
- 4 Australian café owner sparks debate after saying 'No' to having unruly children on premises
- 5 Couple die within 28 hours of each other after being married for 73 years
Renee Zellweger on plastic surgery: 'I'm living a fulfilling life and I'm thrilled that perhaps it shows'
Isis releases first video showing the stoning of woman accused of committing adultery as her father shouts 'don't call me Dad'
Banksy not arrested: Internet duped by fake report claiming artist's identity revealed
Diwali: What is the festival of lights and how is it celebrated around the world?
Nelson Bunker Hunt dead: Former world’s richest man dies in 'modest circumstances' in US after losing his fortune
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Of course, teenage girls need role models – but not like beauty vlogger Zoella
Support for EU membership 'at highest level since 1991' with most Brits wanting to stay 'in'
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver 'kicks gay couple off for kissing'
iJobs Money & Business
£24000 - £28000 per annum + bonus & benefits: Ashdown Group: IT Business Syste...
£18000 - £23000 per annum + Commission: SThree: The SThree group is a world le...
£18000 - £23000 per annum + Comission: SThree: The SThree group is a world lea...
£20000 - £25000 per annum + OTE £Competitive: SThree: SThree Group and have be...