Instore in takeover talks

INSTORE, which owns the Poundstretcher chain of budget stores, said it is in talks over a possible takeover offer for the group.

The Huddersfield-based group made an announcement following recent price fluctuations in the company’s shares.

The groups shares soared by more than 67% in early trading to 9.15p  – prompting Instore to make the announcement.

It said it was “in preliminary discussions with a third party which may or may not lead to an offer being made for the entire share capital of the company” and that a further announcement would be made in due course.

Instore is primarily owned by two major shareholders – South African-listed Tradegro owns around 36%.

Non-executive director Abdul Aziz Tayub – who bought into the company last year – owns around 31%.

Instore has struggled in recent years but has been working hard to transform its fortunes.

The group, which operates 140 shops, blamed the tightening market, rising cost of transport and a poor Christmas for disappointing figures which it announced in April.

The group posted operating losses of £7.4m compared to £12.3m the year before.

These exceptional charges include the acquisition of 33 Ponden Mill stores for £3.8m just before Christmas and £1.8m in restructuring costs including redundancy payments.