Takeover speculation is set to reignite today around Moss Bros, the formalwear retailer, after Kevin Stanford, the founder of the Karen Millen female fashions empire, took his stake from 6 to 28 per cent - just short of the threshold for making a formal bid.
Moss Bros will be informed this morning that Shami Ahmed, the Joe Bloggs jeans entrepreneur, has sold his entire 23 per cent interest in the company, which he has built up over two years and which was held via financial instruments called contracts for difference (CFDs).
Mr Stanford sold Karen Millen to the Icelandic retail conglomerate Baugur in a £120m deal last month. The Moss Bros management has been trying to arrange a meeting with Mr Stanford since he appeared on the shareholder register in March, but his dramatically increased investment will add new urgency.
The company is also keen to establish whether Mr Stanford holds the stake via CFDs or whether he has taken over the underlying shares, which had been held by Mr Ahmed's CFD broker, Cantor.
Although Mr Stanford's intentions were unclear yesterday, Mr Ahmed's exit will bring a sigh of relief at Moss Bros. The company has struggled with what it says is the disruptive influence of recurrent market speculation over Mr Ahmed's intentions towards the business.
Mr Ahmed walks away with a profit of some £9m, having made his first purchases when Moss Bros languished at 25p per share. He sold his stake in a private agreement with Mr Stanford on Friday night at 80p, valuing the holding at £16.6m.
Mr Ahmed has become something of a serial investor in recent years and is understood to be planning to invest his windfall in other, larger retailers.
Moss Bros, which also owns Cecil Gee stores and the UK rights to Hugo Boss, has staged a significant turnaround over the past two years. It said in May that it was expecting to return to profit for the first half of this year. Like-for-like sales growth is running at 9 per cent and margins are improving after its main chain abandoned a disastrous foray into casualwear to concentrate on formal suits and evening wear.