Austin Reed puts pressure on bidder

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The Independent Online

Austin Reed put pressure on Dawnay Day, the investment company stalking the retailer, to raise its 131p-per-share approach after it issued an upbeat set of interim figures and claimed it was "on the road to recovery".

The group, which two weeks ago rebuffed a £42m approach from Dawnay Day, its biggest shareholder, yesterday said its chains had turned the corner after a difficult few years. Its shares rose 4p to 138.5p on hopes that its suitor would return with a fresh bid. Nick Hollingworth, who is two years into his role as chief executive, said the group was making "good progress" with a strong rise in sales.

"Fashion is going our way. Women are dressing up more than they have for a long time and the days of dressing down in the City are waning," he said.

Autumn's tailored looks that have resurrected heritage fabrics like tartan and tweed play suit Austin Reed's older customer base that can afford to splash out on a new wardrobe.

Since the start of its half-year, underlying group sales growth has accelerated, rising by 11.6 per cent after climbing 7.6 per cent in the 28 weeks to 12 August. Mr Hollingworth cautioned that he "certainly does not expect" the strong start to continue, but reiterated his confidence that the group was on the mend.

It turned last year's £1.1m interim loss into a £500,000 pre-tax profit, before a £1.8m exceptional gain from a property deal. Net debt of £10.7m a year ago has been eliminated but there was no interim dividend.

Dawnay Day declined to comment but is understood to be considering its options.

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