Shares for struggling online retailer Asos were boosted 7 percent after speculation over a rumoured takeover bid ran rampant through the media.
According to The Sunday Times, the company was approached with a 1.24 billion dollar takeover bid in December 2022 by Trendyol, a Turkish online competitor backed by Chinese e-commerce giant Alibaba.
The media outlet said that the firm was believed to have worked with Morgan Stanley to form the offer and had also approached Asos’ largest shareholder, Bestseller owner Anders Povlsen, to see if he was also interested in partaking in the deal.
Such a move has sparked speculation around a potential bidding war for Asos, and comes amid further reports that suppliers of the company had begun cutting back on providing goods after its credit insurance was believed to have been withdrawn.
Suppliers cut back provisions
The Times cited a number of anonymous suppliers who said they had stopped supplying the retailer as it struggled to maintain profits, stating that they had halted the process until the insurance came back.
Asos noted in its own statement that, despite the tightening of its trade credit insurance, it had seen no impact on its trading.
The retailer is among many that have struggled post-pandemic with widening losses and revenue drops largely due to falling consumer confidence and supply chain disruptions.
Last month, it secured a 75 million dollar raise from three of its shareholders, including Povlsen’s Aktieselskabet Af, as it looks to return the business to sustainable profitability and achieve a flexible balance sheet.
In an attempt to further its hold on Asos, Povlsen’s direct competitor Mike Ashley’s Frasers Group also upped its stake in the firm to nearly 9 percent, which takes the group one step closer to having the ability of blocking a takeover bid.
The group has continued to increase its stake in Asos over the past year, suggesting that Ashley could be considering onboarding the retailer into its ever-expanding portfolio.