One leading investor in Currys has told Sky News that its board should refuse to engage with suitor Elliott Advisors unless it offers at least 75p-a-share for the chain.
By Mark Kleinman, City editor @MarkKleinmanSky
A leading shareholder in Currys is demanding that its board slaps an £800m price tag on the electrical goods retailer amid takeover interest from a former backer of Comet, its defunct rival.
Sky News has been told by one of the company’s largest investors that they believe Currys’ board should hold out for at least 75p-a-share from Elliott Advisors, the private equity firm.
Shares in Currys will be in sharp focus when trading opens in London on Monday morning after it confirmed a Sky News report over the weekend that it had received an indicative takeover proposal from Elliott.
Elliott, the owner of Waterstones, tabled a 62p-a-share offer for Currys on Friday worth about £700m.
It was immediately rejected as “significantly undervaluing” the company.
One major shareholder said the sum-of-the-parts valuation of Currys led them to believe that its board should not engage in discussions with Elliott unless it said it was prepared to offer 75p-a-share “at a minimum”.
A number of City analysts have highlighted the value of the group’s “Care and Repair” business in the UK and Ireland as well as the recovery in its Nordic operations to set a target price for the stock in excess of 75p.
Currys employs more than 15,000 people in the UK, trading from about 300 stores.
In 2021, the company rebranded under its current name, having absorbed shops operating under brands including PC World, Dixons and Carphone Warehouse.
It was founded in 1884 by Henry Curry as a bicycle-building business before diversifying into the sale of toys, gramophones and radios when it listed on the London stock market in 1927.
Now led by chief executive Alex Baldock, Currys has been grappling with the same inflationary headwinds which have afflicted the rest of the retail sector and wider consumer economy.
Last month, it reported a dip in like-for-like sales during the crucial Christmas trading period but was able to announce a modest upgrade to profit forecasts as a result of cost-cutting measures.
The company trades in eight countries, including Denmark, Finland and Sweden under the Elkjop brand.
In total, it employs 28,000 people and operates more than 800 stores.
A chunk of these are in Greece, where it has announced a £175m sale of its operations to the country’s Public Power Corporation.
Shares in Currys closed on Friday at 47.08p, giving it a market capitalisation of about £525m.
The stock has fallen by more than a third in the last 12 months.
On Sunday evening, The Telegraph reported that JD.com, the Chinese online shopping giant, could also be interested in exploring a bid for Currys.
Currys declined to comment.
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
