Retail giant takes stake in Currys to gain further foothold in electricals market
Frasers Group, the retail empire founded by billionaire entrepreneur Mike Ashley, has snapped up an 8.9% stake in Currys, with the news coming a little over a week after the group acquired a substantial portion of online electricals retailer, AO World.
Frasers’ shareholding in Currys is worth around £53.5m given the firm’s market capitalisation of £601.9m.
Founded in Leicester in 1884, Currys originally built bicycles before moving into the electricals market in the mid-twentieth century. It has since grown to become one of the largest operators in the sector with over 280 outlets across the UK. Currently headquartered in Acton in West London, the company was acquired by Dixons in 1984 and traded as Currys PC World between 2008 and 2021.
In May, Currys said it was expecting to post pre-tax profits of between £110m and £120m for the year to 29 April 2023, marginally ahead of previous guidance.
Frasers, which has a huge base at Shirebrook in Derbyshire, acquired 19% of AO World for £75m earlier this month before upping its stake to 21.3% to become the company’s largest shareholder.
Michael Murray, Frasers CEO, said the acquisition would drive growth in the group’s bulk equipment and homeware ranges.
It is unclear what the retailer has in mind for Currys, but Frasers’ increasingly bullish manoeuvres in the stock market suggest it may look to increase its stake in the coming months.
In other news, Frasers told the London Stock Exchange this morning (20 June) it has instructed Liberum Capital to conduct a new non-discretionary share buyback programme.
The aggregate purchase price of all shares acquired under the programme will be “no greater than £70,000,000”, with a total of 10m shares available to purchase.
The share buyback programme has been launched to reduce the share capital of the company and will conclude when Frasers publishes its results for the financial year ended 30 April 2023.
