Katies owner Specialty Fashion Group is facing a $100m deadline this week
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Private equity has been kicking the tyres of listed retailer Specialty Fashion Group, which owns chain stores including Millers, Katies, Crossroads, Autograph, City Chic and Rivers.
The bricks and mortar fashion retailer (ASX:SFH) is in the middle of a strategic review, restructuring to position itself in a world of increasing digital sales.
“In the course of that review, the group has received a number of confidential, non-binding indicative proposals for a change of control of the group or the acquisition of certain brands,” the company says.
Anchorage Capital Partners has made a $100 million cash offer for City Chic and Autograph.
The offer runs out this week and Specialty Fashion Group doesn’t believe an agreement will be reached.
“There are a range of outstanding issues that are yet to be agreed with Anchorage and the offer is subject to a number of conditions,” the company says.
Specialty Fashion Group shares have recovered strongly this year after falling to a 52-week low of 10c in December.
The shares were fetching 40c on Thursday — though still down from the 60c levels of 2016.
The company says it will consider all options including divestment of brands, whole of company and a potential capital raising.
Specialty Fashion Group says it has made good progress in a competitive retail environment.
The company’s objective is to transform the business into an agile omnichannel retailer with a strong and visible presence online and on the high street.
The retailer has been closing unprofitable stores.
In February, the company posted underlying earnings for the half year of $18.5 million, ahead of the forecast range of $14 million to $17 million, due to better-than-expected Christmas trading.
Other retailers have reported weak holiday trading and increased competition from digital players.