The owner of Crew Clothing is to buy Moss Bros for £22.6m.
Brigadier Acquisition Company, which is controlled by Menoshi Shina, owner of Crew Clothing, has agreed to pay 22p a share for the menswear tailoring business. The acquisition is expected to be completed in the second quarter of 2020.
Shina said: “We are delighted that the directors are recommending our offer to acquire the business, as we greatly admire the heritage and 169-year history of Moss Bros and the quality and determination of its existing management team.
“We believe that Moss Bros can have a bright future in the private arena, and are excited to contribute our expertise and assist in delivering the current strategy. We see the acquisition as an opportunity to partner with an excellent management team to improve Moss Bros’ financial performance and protect its heritage, brand and presence on the UK high street.”
Colin Porter, chairman of Moss Bros, said: “In September, the board of Moss Bros set out its strategy to drive Moss Bros’ long-term performance and we have seen some early positive results which support the board’s confidence in Moss Bros as a standalone entity.
“However, the board is also aware of the risks attached to executing this strategy in the current retail operating environment and as a publicly listed company.
“Having considered a range of strategic options, the board believes that the terms of the acquisition, which offers a premium cash exit to Moss Bros’ shareholders, fairly reflect the value of Moss Bros and its prospects, taking account of these risks.”
Moss Bros’s revenues grew 1.4% to £65.4m in the first half of 2019, buoyed by increased store sales – up 0.6% year on year – and online growth of 20%.
However, its losses before tax grew to £2.7m in the 26 weeks to 27 July, up from a loss of £1.7m in the first half of 2018. Moss Bros said the new IFRS 16 property reporting standards meant profits took a £1.1m hit.