Philip Day’s Spectre Holdings Limited announced on Thursday the early closure of its £5.7 million cash takeover offer for Wakefield fashion firm Bonmarché Holdings following a poor trading update from the retailer.
Day had previously issued an open-ended offer to Bonmarché shareholders — but the offer will now close at 5pm on July 12.
If Spectre receives enough acceptances by this time to bring its holdings to more than 75% of the company, it plans to take Bonmarche off the stock market.
Bonmarché said on Wednesday that recent trading has been so poor that it now recommends shareholders accept Day’s cut-price buyout offer — two months after dismissing it as “inadequate.”
Shares in Bonmarché have fallen to around 11.4p, having plummeted from around 119p at this time last year.
Day, who made his fortune with Edinburgh Woollen Mill, recently bought 52.4% of the shares in Bonmarché from a subsidiary of private equity group Sun Capital at 11.445p a share.
The acquisition of the stake triggered a mandatory offer for the rest of Bonmarché’s shares.
In a stock exchange statement on Thursday, Spectre Holdings said: “In light of the Bonmarché board’s latest trading update, Spectre now believes that the passage of time, and a further decline in the performance of Bonmarché, has eroded Spectre’s ability to provide the advice, guidance and support needed to secure the long-term future of the Bonmarché business, its stores and employees.
“Spectre is especially concerned by the suggestion that PwC, Bonmarché’s auditor, may shortly express uncertainty about the company’s ability to continue as a going concern in its FY19 accounts.
“Spectre also notes Bonmarché’s comments that the company has adequate liquidity only insofar as its bank continues to support it with a £5 million overdraft and other facilities.
“Against a background of negative trading updates and declining financial performance, Spectre is concerned Bonmarché may soon no longer have facilities available to it.
“In light of this information, Spectre believes it is now forced to close the offer.
“In accordance with the announcement made on 16 May 2019, Spectre must give not less than 14 calendar days’ notice before closing the offer.
“As a result, the offer will close at 5.00p.m. on 12 July 2019.
“The offer, which remains subject to the terms set out in the offer document and, in respect of certificated Bonmarché shares, the form of acceptance, will remain open for acceptance until that time.
“Although Spectre is closing the offer, Spectre expects the Bonmarché board to keep Bonmarché shareholders updated on ongoing trading and on the outlook for the full year.”