Baugur, the Icelandic investment fund, has opened up a rift on the board of Moss Bros as it ended months of speculation by making a £40m indicative cash offer for the menswear and formal-hire chain.
Moss Bros said it had allowed Baugur access to its books but a non-executive director, Mark Bernstein, who is married to a member of the founding Moss family, opposed the decision.
Baugur and unidentified strategic partners made an indicative offer of 42p a share for Moss Bros, just 2.25p more than the retailer's closing share price on Friday.
Moss Bros's roots go back to 1851, when Moses Moses opened two shops in London's Covent Garden. Ms Moses' descendants, the Moss family, own 18.5 per cent of the company. Moss Bros merged with Cecil Gee, the menswear retailer, in 1988 and the Gee family holds 7.8 per cent of the shares.
Baugur's approach coincided with a profit warning from Moss Bros, which said this year's profit before non-recurring items would be lower than management's previous expectations. The company also said it would cut jobs because of difficult conditions in the retail market but that it wanted to keep compulsory redundancies to a minimum.
The families fear that Baugur is trying to buy the company on the cheap. Moss Bros has suffered from competition from supermarkets, fewer marriages and the general slowdown in consumer spending as households tighten their belts.
Moss Bros shares rose 5 per cent to 41.75p yesterday, indicating that investors did not expect a higher offer for the company.
Unity, an investment vehicle part-owned by Baugur, already owns 28.5 per cent of Moss Bros. Baugur is making its bid with different partners from those involved in Unity and would buy out those investors if a deal was agreed.
Baugur, which owns stakes in retailers with 3,900 stores around the world, said in December that it was considering an approach for the shares of Moss Bros it did not already own. The acquisitive group has bought up swathes of the UK high street, including House of Fraser, Oasis and Whistles.