The founder of Mulberry is to resign from the company's board following the launch of a £3.5m rights issue that will hand full control of the luxury goods group to its biggest shareholder, the Singaporean billionaire Christina Ong.
Roger Saul, who was ousted as Mulberry's chairman and chief executive in a boardroom coup late last year, will step down as a non-executive director next month, all but severing his links with the company he set up with £500 on his 21st birthday.
Mr Saul, whose family has opted not to take up the heavily discounted two-for-seven offer, will see his stake in the company shrink to 28 per cent but his resignation will not affect his figurehead status as president, which runs to November 2004.
The Ongs, whose empire also includes London's Metropolitan hotel and Nobu restaurant, will see their 41.5 per cent shareholding in Mulberry soar to a minimum of 51 per cent following the open offer - giving them control of the group. Their Challice investment group, which is underwriting the placing, could wind up with 57 per cent of the company.
Godfrey Davis, who replaced Mr Saul as chairman and chief executive, described the Ongs' move to take control as a "mathematical" coincidence based on the sum the company is seeking to raise.
The Ongs invested £7.6m in Mulberry in 2000 as part of a joint venture agreement intended to bankroll the group's expansion in the US. Accusations that they had reneged on that deal sparked Mr Saul's ousting last year.
Mr Davis said the cash call, priced at 28p per share, was a "cash buffer" to cover working capital needs and help strengthen the brand. Separately, the group said its pre-tax loss for the year to 31 March had widened to £2.1m from £1.7m. Its shares slipped 1p to 61p.