Fat Face aborts plans for London listing
The lifestyle clothing brand, whose chairman is former Mark & Spencer chief executive Sir Stuart Rose, cited current equity market conditions as the main reason behind the decision. The company was looking to raise £110 million through the flotation.
In a statement Fat Face said: “Fat Face Group announces that despite a strong level of interaction with and interest from institutional investors, the company and its majority shareholder have decided to discontinue its plans for an IPO at this stage.
“Current equity market conditions are the principal factor in the decision.
“The board remains confident in the prospects for the business and will continue to execute the growth plans which are already underway.”
Currently operating 208 stores, Fat Face’s expansion strategy includes opening approximately eight to ten stores per year across the UK. It also plans to enter international markets by trialling two to three stores on the east coast of the US within the next two years. This will also include the launch of a dedicated US website.
Chris Searle, corporate finance partner at accountants BDO, said: "Fat Face pulling the IPO may mean that some of the frothiness is coming off the IPO market. The market has had a good run in this year to date, but valuations have come off in recent weeks, perhaps reflecting fatigue on the part of institutions or greed on the part of companies and their advisers in terms of valuation. I’m sure there is still appetite for companies coming to market but they have to be realistic in terms of their valuations."
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