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French Connection, in Takeover Talks, Loses Frasers Stake

Frasers Group has exited its 24.9 percent stake in French Connection, which is entertaining two separate takeover offers.

French Connection said on Friday that it has received separate “approaches” from Spotlight Brands, working with Gordon Brothers Int’l LLC, and Go Global Retail in concert with HMJ International Services. The fashion retailer cautioned that talks with each one may or may not result in a viable offer.

“Discussion with both Spotlight and Go Global remain at a very early stage,” said French Connection, which was founded in 1972 by Stephen Marks.

Both Spotlight and Go Global have until March 5 to announce any offers, per a regulatory requirement. French Connection also emphasized, to avoid any doubt, that the parties not acting in concert with each other.

Spotlight Brands is a $500 million Los Angeles-based investment firm that was launched last year, with the backing of Strand Equity Partners. Strand has familiarity with fashion investments, counting Sweaty Betty, Thom Browne New York, Alex & Ani and Flywheel among its portfolio. Moreover, Strand’s founder Seth Rodsky is a founding partner in the Draper James brand, which is led by actress Reese Witherspoon. Ramez Toubassy, a co-founder of Spotlight who was formerly affiliated with Gordon Brothers, heads up the investment firm.

Founded in 2016 by veteran fashion executive Jeff Streader, Go Global is a brand investment platform whose partners include investment, retail and operational executives. Its first acquisition was a 2019 deal for ModCloth from Walmart. At the time, Streader told SJ that Go Global’s structure allows for brands under the company’s ownership to work with different investors. What’s interesting about Go Global is that investors can include manufacturers across Asia, which also have the opportunity to participate in the supply chain of a brand under the brand investment platform. Streader calls it “committed production” for their factories.

French Connection was trying to find a buyer in 2019, with Frasers Group’s Mike Ashley showing interest, but ultimately failing to complete a deal. Marks still has about a 40 percent stake in the retailer. The 96.6 million shares of French Connection that Frasers Group sold were held by a group consisting of Ashley, MASH Holdings Ltd., MASH Beta Ltd. and Frasers Group plc.