3rd Apr 2025 11:54
(Alliance News) - Frasers Group PLC on Wednesday said it has expanded its strategic investment in German fashion house Hugo Boss AG, increasing its shareholding and deepening its exposure through the sale of further put options.
The Shirebrook, England-based owner of multiple retailers, including House of Fraser, Sports Direct and Flannels said it now owns 13.5 million shares in the German fashion brand, representing a 19.2% direct stake. It also holds exposure to up to an additional 16.7 million shares via put options, which represent a further 23.7% of Hugo Boss's share capital.
Frasers noted that, if all options are exercised, its total interest in Hugo Boss could reach 30.2 million shares, a 43% stake.
At Hugo Boss's closing share price on Wednesday, the maximum aggregate exposure from this interest is estimated at EUR1.02 billion, or around GBP850 million.
The group, led by Chief Executive Officer Michael Murray, said the latest trades form part of a longer-term strategic investment. "The company remains a long-term investor in Hugo Boss and the board of directors of Frasers Group believes that the HB strategic investment will create value for the company's shareholders, as its strategic investments in Hugo Boss have done in the past." Frasers said.
In December it was announced that Murray, who is also the son-in-law of company founder Mike Ashley, had been nominated for election to Hugo Boss's supervisory board at the brand's annual general meeting, which will take place in May.
Frasers receives a premium from selling the put options, which give counterparties the right to sell shares to the group at a fixed price until June 2027.
Hugo Boss, headquartered in Metzingen, Germany, is listed on the Frankfurt Stock Exchange and had earnings before tax of EUR301.5 million and gross assets of EUR3.7 billion as of the end of 2024.
Frasers said the latest trades will be financed through existing cash resources. Gains or losses on the equity derivatives will be reflected in investment income or costs for the year ending April 27, 2025.
Shares in Frasers were down 2.1% at 604.63 pence in London at midday on Thursday. Hugo Boss shares were 1.3% lower at EUR34.97 in Frankfurt. The FTSE 250 and MDAX both were down 1.6% on Thursday, following US President Donald Trump's tariff announcement on Wednesday evening.
By Eva Castanedo, Alliance News reporter
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