Britain’s Frasers in Bid to Takeover Norway’s Xxl Asa

LONDON (Reuters) -British sportswear and fashion group Frasers on Friday launched a bid to takeover Norwegian sporting goods retailer XXL ASA, saying it did not agree with the Oslo-listed company’s plan to issue more shares.

Frasers, majority owned by Mike Ashley, said it was offering 10 NOK ($0.9044) a share for the equity it does not own in XXL – a premium of 25% over its closing price of 8 NOK on Thursday and valuing the group at NOK 246.4 million ($22.3 million).

The UK retailer already holds 25.8% of the issued share capital of XXL, which also operates in Sweden, Finland, Denmark and Austria.

“The proposed Alternative Rights Issue is wrong, its legality is questionable and its implementation will be extremely detrimental to both Frasers and the other minority holders,” Frasers said.

It said XXL should not be asking shareholders for further funding when “it has not articulated any clear plan to address and resolve the root causes of its persistent problems.”

Frasers has been expanding overseas with recent deals in the Netherlands, Australia/New Zealand and Africa.

However, on Thursday it cut its profit guidance blaming a drop in consumer confidence caused by the UK government’s budget.

($1 = 11.0411 Norwegian crowns)

(Reporting by James Davey; editing by Jason Neely and David Evans)