Frasers Group reportedly eyeing a takeover of Hugo Boss

BOSS Silverburn
BOSS store at Silverburn, Glasgow

Mike Ashley’s Frasers Group is reportedly eyeing a takeover of luxury brand Hugo Boss having already built up a sizeable stake in the business.

Shares in Frankfurt-listed Hugo Boss jumped 6%, valuing the business at €3.2bn, on the back of the speculation the Frasers was preparing to swoop, The Telegraph has reported.

Frasers, which also owns House of Fraser, Sports Direct, Flannels, USC and Jack Wills among others, already owns a 15.2% stake in Hugo Boss.

Last June it declared it had taken a 5.1% stake before upping it to 10.1% within the same month. In January it upped its stake further to 15.2%.

When purchasing the shares in January, Frasers said its motivation was a reflection of the growing relationship between the two businesses, adding: “Frasers Group intends to be a supportive stakeholder and create value in the interests of both Frasers Group’s and Hugo Boss’ shareholders.”

Speculation has also been mounting that French luxury conglomerate LVMH, home of Louis Vuitton, Givenchy and Christian Dior, could also make a play for Hugo Boss. The chairman of the group, Bernard Arnault, has been snapping up shares worth €440m in recent months using investment vehicles controlled by himself and his family.

Frasers is known for taking strategic stakes in businesses, which does not necessarily mean an offer will be made. It also has a 36.8% stake in luxury house Mulberry. Despite this being over the usual 30% threshold at which a formal takeover offer is usually made, Mulberry already has a majority shareholder in the investment vehicle for Singapore’s Ong Family, which owns 56%.

Fraser was obliged to clarify its intentions towards Mulberry last December and said that it did not intend to make a bid in the short-term.

Until recently it held a 25% in mid-market fashion chain French Connection but offloaded the shares in February.

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