Partly Cloudy

Partly Cloudy

max temp: 11°C

min temp: 10°C

ESTD 1874 Search

Retail: Mothercare rebuffs takeover approach from Destination Maternity

09:08 02 July 2014

Mothercare has rejected a £266m takeover approach.

Mothercare has rejected a £266m takeover approach.

Baby products retailer Mothercare has rejected takeover approaches worth as much as £266million from a leading North American retail chain.

Destination Maternity, which is the world’s largest designer and retailer of maternity wear with more 1,900 retail sites, has so far failed to persuade the board of Mothercare to engage in talks over its interest.

It disclosed today that it has tabled two approaches to the struggling UK chain, with its latest cash and shares proposal on June 1 valuing Mothercare at 300p a share, equivalent to £266m.

Mothercare, which has 220 UK shops under the Mothercare and Early Learning Centre brands, has been closing stores and developing its internet offer as part of a long-running effort to turn around its fortunes.

It recently recorded UK losses of £21.5m after annual sales fell by 7.5% and the company is without a permanent chief executive after Simon Calver resigned in the wake of a profits warning due to poor Christmas trading.

Destination Maternity said it wants to introduce its brands such as A Pea In The Pod and Motherhood Maternity to Mothercare’s UK stores and international franchise stores.

Its proposals involve combining the two companies under a new UK holding company, which would be listed in the United States.

Chief executive Ed Krell said a tie-up would provide a global platform to expand both Destination Maternity’s maternity wear business and Mothercare’s baby and children’s business.

He added: “We have long been familiar with Mothercare and hold the company’s UK heritage and successful track record of international expansion in the very highest regard.”

However, Mothercare chairman Alan Parker said: “The board has given these proposals full and thorough consideration.

“We do not believe they reflect the inherent value of Mothercare to our shareholders or its prospects for recovery and growth.

“In addition, we have significant concerns about the deliverability of these proposals. Mothercare has a very strong and valuable international business and significant potential for sustained improvement in the UK.”

Mothercare’s franchised-based international arm is now seen as the growth engine of the business and, with 1,221 stores in 59 countries, accounts for more than 60% of worldwide space and sales. In May, the division’s resilient performance helped the group post a 61% rise in overall underlying profits to £9.5m.

Destination Maternity has 1,906 retail locations, including 578 stores mainly under the names Motherhood Maternity, A Pea in the Pod and Destination Maternity. There are also 1,328 leased department store locations and it sells on the web through Destination

The Philadelphia-based business was founded in 1982 as Mothers Work, a mail order business, and now generates more than 500m US dollars (£291.1m) in annual sales.

Search hundreds of local jobs at Jobs24


Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files

Please log in to leave a comment and share your views with other East Anglian Daily Times visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by East Anglian Daily Times staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique East Anglian Daily Times account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

Ipswich High School

One of Suffolk’s top independent schools has announced it is recruiting several new members of support staff.

David Anderson, Managing Director of BHS International, as the Qatari owners of the rebooted BHS brand are to push the retailer through a major international expansion.

The Qatari owners of the rebooted BHS brand are to push the retailer through a major international expansion.

A Carluccio's restaurant in Norwich.

Italian restaurant group Carluccio’s is to create up to 500 jobs a year as part of expansion plans following a multimillion-pound investment from its owners.

The Lockheed Martin F-35 Lightning II performs a fly past during the Royal International Air Tattoo at RAF Fairford - the world's largest military airshow.

Struggling aerospace and defence firm Cobham has issued a profit warning after “challenging” trading in the third quarter.

The rebranded University of Suffolk has also improved the economic prospects of Ipswich, pushing up house prices, estate agents say.

University of Suffolkl puts the focus on business at the Waterfront this week


Show Job Lists

Most read

Most commented

Topic pages


Newsletter Sign Up

Sign up to the following newsletters:

MyDate24 MyPhotos24