Mike Ashley’s bid for Australian fashion firm MySale is rejected

Mike Ashley’s daring bid for Australian fashion company MySale was rejected yesterday in his latest showdown with arch-rival Sir Philip Green.

The tracksuit mogul’s 2 cents per share offer was dismissed as a “material undervaluation” of the company.

Ashley and Green are the two largest shareholders of the AIM-listed company, together owning 45 percent of the company.

They bought the flash sale specialist when it joined the London Stock Exchange in 2014, but Ashley dumped its stake five years later after a rift developed between the pair. Green held on to his bet, despite its value being almost wiped out.

Ashley then became MySale’s largest shareholder when he bought a 28.7 percent stake this summer.

At the time, a friend of Green said Ashley “don’t know what he’s doing.”

Weeks later, Ashley made an offer through his Frasers Group to pick up those shares in the company he doesn’t own for £13.6 million – or 2 pence each.

Frasers said it wanted to use MySale to drive growth in Australia and New Zealand and clear up unsold inventories.

But his offer was rejected by the MySale board. When Green invested in the business, the shares were worth 226p meaning he would take a loss of around £80m if the takeover was approved.

MySale said Ashley’s offer was a quarter below the company’s value the day before it was released, noting that it was the lowest offer he could have made under the city’s takeover rules. Retail analyst Nick Bubb described the offer as “brutal”.

MySale said Ashley’s offer was not “fair and reasonable” and told shareholders to vote against.

But MySale’s rejection was undermined when chairman and founder Carl Jackson stepped down over his decision to support Ashley’s offer. Jackson is MySale’s fifth largest shareholder, with a 10.6 percent stake. He will be replaced by senior director Charles Butler.

MySale buys excess inventory from retailers in Europe and sells it cheaply online in Australia, New Zealand and Southeast Asia.