Peter Simon mounts a fresh bid to make Monsoon private |
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Sun, 24 Jul 2005 01:35
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LONDON: The founder and chairman of clothing retailer Monsoon, Peter Simon has indicated that he wants to make the firm totally private and is currently in hectic parleys to buy-out the remaining 24.6 percent of the company that is owned by people outside the family circle.
Confirming these moves in a statement, the company said, "The board of Monsoon confirms that it has entered into preliminary discussions with its chairman, Peter Simon, regarding his family interests making a possible offer for the 24.6 percent of the company not already owned by them." However, the statement cautioned that this was not a guarantee that an offer would be made or accepted.
This announcement sent Monsoon shares spiraling by 27.5p to a new high of 390p. This is a 7.6 percent rise in the share value. At this value Monsoon is worth about £691 million, which means that 24.6 percent of the shares is likely to cost around £170 million.
Ever since Mr. Simon founded Monsoon over 30 years ago, he has sought to have maximum control over the business, something that has not been allowed by shareholders so far. He had tried to buy out almost 20 percent of the remaining shares around 18 months ago. Investors were not happy with the offer, which had valued the shares at 140p.
Since then, Mr. Simon has been making some quiet moves. The first of these was the shifting of the company quotes to the Alternative Investment Market. He was however, able to increase the family stake to 75 percent after the last bid. His move to get the remaining shares for as cheap a value as possible was not liked by analysts who came down heavily at him, Richard Ratner, an analyst at Seymour Pierce, was more than critical of the move, "Peter could have privatized this business two years ago at 160p or 170p, but he was too greedy and tried this ridiculously complicated tender offer that didn’t work. Now he's got himself a militant bunch of shareholders. He's made a rod for his own back," he commented.
But the strong performance by Monsoon has strengthened Mr. Simon’s hand and he has now made this new bid. He might however have to pay more than he bargained for.
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