Rose bought shares in M&S on same day suitor requested talks

By Susie Mesure
Wednesday 08 August 2012 05:38
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Stuart Rose, Marks & Spencer's new chief executive, was summoned to a meeting with Philip Green, the Bhs owner stalking the high-street retailer, on the same day that he acquired 100,000 shares in the company.

It emerged yesterday that Mr Green telephoned Mr Rose on 7 May to set up the meeting at which he disclosed his plans to bid for M&S. On 7 May, Mr Rose spent £276,500 on 100,000 shares in the company, which were then trading at close to a four-year low. Five days later, on 12 May, at a meeting, Mr Green invited Mr Rose to join his bid team, an offer Mr Rose declined.

Mr Rose maintained last night that Mr Green did not breathe a word about his plans during his original telephone call. He took the decision to buy shares in M&S the previous week but had instructed his broker to wait for the shares to go down before placing a buy order. Last night his parcel of 100,000 shares had soared in value by £84,5000. "The first that I knew of Philip Green's plans to bid for M&S was at the meeting on 12 May. Since that time I have not bought a single M&S share," Mr Rose said. He also queried the date of Mr Green's phone call, claiming not to remember exactly when the Bhs boss had rung.

It was on 7 May that the news first broke that M&S had instructed headhunters to find a replacement for Luc Vandevelde, the former chairman who was abruptly ousted as part of the retailer's defence against Mr Green's bid. Although Mr Rose promptly emerged as the front-runner to head the company he left 17 years ago, his share purchase pre-dated his campaign to persuade M&S's shareholders to press for his appointment.

A source close to Mr Rose stressed that there was nothing unusual in the then out-of-work retailer meeting Mr Green. The pair knew each other well, most recently crossing paths when Mr Green acquired Arcadia, the Topshop-to-Burton group Mr Rose used to run. "Stuart understood that Philip had asked to see him for a 'chitty-chat'. It was a catch-up," an M&S source said.

The shares acquired on 7 May comprise the bulk of Mr Rose's holding of 135,000 shares in M&S, worth £486,675 at last night's closing price. Mr Rose has bought and sold shares in the group on six other occasions during the past 20 months. Twice before, in October 2002 and December 2002, he acquired parcels of 100,000 shares; on one occasion he bought 200,000 shares in a single transaction.

Mr Rose, who holds his shares via Giltspur Nominees Limited, disclosed his holding in a statement issued to the stock market on Thursday evening.

While the revelation that Mr Rose bought shares so close to the 12 May meeting has emerged at an unfortunate moment during the biggest retail battle the UK has witnessed, it failed to perturb M&S's shareholders. One institutional investor said: "Anyone with an iota of retail sense has known that M&S has been a stock waiting to happen. I am sure that anything Stuart did was perfectly above board."

Separately, Mr Green's camp last night attempted to sound out Brandes, the US investor that owns almost 12 per cent of M&S. It was unclear how the meeting went, or whether Brandes was prepared to give Mr Green any indication it would accept his cash offer of 370p per share.

Brandes has been chipping away at its stake in recent days, selling another chunk yesterday. However Capital Group, another key US investor revealed it had acquired 167,417 shares at 359.75p on 18 June, giving it a 3.83 per cent stake.

STUART ROSE: THE DAY TRADES

7 October 2002: Buys 100,000 shares at 307p

15 October 2002: Sells 100,000 shares at 350p

11 December 2002: Buys 100,000 shares at 327.5p

11 September 2003: Sells 65,000 shares at 309.25p

10 March 2004: Buys 200,000 shares at 284p

4 April 2004: Sells 200,000 shares at 283p

7 May 2004: Buys 100,000 shares at 276.5p

21 June 2004: Mr Rose's 135,000 shares are worth £486.675.

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