• Home
  • News
  • Business
  • Burberry says No to Coach’s numerous takeover offers

Burberry says No to Coach’s numerous takeover offers

By Vivian Hendriksz

loading...

Scroll down to read more

Business |FOLLOW UP

London - Those who were hoping to see a super merger of Burberry and Coach will be disappointed, as the British luxury fashion house is understood to have rebuffed numerous takeover offers from the US fashion company. Although the market value of the two fashion houses combined would have been more than 20 billion dollars, the money was not enough to seal the deal, according to a report from the Financial Times.

Discussions between the two fashion companies are no longer taking place, as Burberry is understood to have waved off interest in deal from Coach, according to people familiar with the matter. Coach’s proposal are said to have been quite informal and centred around a cash and stock take over of the British fashion heritage brand. However, it remains unclear at what premium the offers were made at, or if Burberry ever entered into serious discussions with Coach on the potential merger.

The report follows on from speculation that Burberry and Coach were considering a merger between the companies earlier this year. In October, Reuters stated that the two were not actively discussing any potential tie-ups. Since then both fashion companies have declined to comment on the matter. A source noted that Coach could have stood a better chance on merging with Burberry if it had come to the British luxury company earlier this year, as the fashion house’s shares were hit by the slowdown in demand from Asia and concerns with its leadership under Christopher Bailey during the first half of 2016.

However since then Burberry has climbed its way back and is showing signs of a solid recovery. Although it’s share price was hit by the Brexit, the Burberry is said to have strongly benefited from an exchange rate bump from sales in euros and dollars. Shares in the British fashion house have increased by a third since falling to their lowest level in June of 14.11 pounds as the fashion house currently holds a market value of 6.2 billion pounds with no debt.

In addition, Burberry’s recent appointment of Marco Gobbetti, who is set to join the team as chief executive in 2017 has helped restore shareholder and investor faith in the company.

Photos: Burberry, Facebook

Burberry
Coach
Mergers and acquisitions