Fraser adds Beatties to its acquisition portfolio |
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Tue, 28 Jun 2005 12:35
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LONDON: Leading high street retail group House of Fraser yesterday announced it was acquiring smaller rival Beatties Group in a deal worth £69.4 million - 168p a share. The merger is expected to give HoF greater national presence.
HoF was founded in Glasgow in 1949 and has since grown with strategic acquisitions like Army & Navy chain of stores, Dickens & Jones and Rackhams. In March this year, Scotland’s historic department store Jenners was added to this list. HoF currently has 50 outlets across the UK. Recently it opened new stores in Maidstone, Dublin and its largest store in Croydon.
Beatties, which began business as a draper’s store in Wolver Hampton is listed on the stock market as ‘James Beattie’, the store’s founder. Its stores are located in Aylesbury, Burton, Birkenhead, Northampton, Worcestershire and Huddersfield.
The current slowdown in consumer spending is believed to have shaken up many a retailer after posting losses. HoF had this month reported a 3.2 percent drop in like-for-like sales during the first 19 weeks of this financial year. Beatties’ West Midlands stores had also reported sluggish sales resulting in profits declining £1m to £4.2m last year.
Brian Heilbron, who took charge of Beatties as chief executive two months ago, had decided to review the stores’ merchandising strategy to in order determine where the problem lay.
HoF’s offer of 168p a share includes a premium of 14.7 percent over Monday’s closing price of James Beattie. The larger retailer said it would also pay into the latter retailer’s pension fund £4m now and another £9m over the next two years.
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