Carpetright has agreed terms of a recommended cash offer from MHL to acquire the retailer's share capital not already owned by Meditor (see related), bringing a takeover one step closer. MHL is a newly incorporated wholly-owned subsidiary of Meditor which was established specifically for the purpose of the acquisition.
Last month, major Carpetright debt- and shareholder Meditor made a possible offer to acquire all the retailer's shares, which would enable the conversion of the majority of its debt to equity, equipping Carpetright with the necessary balance sheet to pursue growth.
Bob Ivell, chairman of Carpetright, comments: “We believe the MHL offer is in the best interests of all stakeholders. While we have made significant progress with our recovery plan for the Carpetright Group, our ability to invest in the future of the business has been constrained against the backdrop of limiting banking covenants and a very challenging consumer market. With a recapitalised business and the backing of a committed new owner with the resources to invest in Carpetright for the long-term, we will be able to complete our recovery in the private arena and emerge as a stronger business.”
Talal Shakerchi, director of MHL, adds: “I believe this scheme represents the best outcome for all stakeholder groups. In particular, with Meditor’s support and financial backing and without the constraints of a public market listing, Carpetright will be well positioned to compete more effectively. This will facilitate substantially increased investment in Carpetright’s committed employees and its store estate as well as driving new initiatives and improvements. I am excited about the long-term prospects and opportunities for the Carpetright business.”
Carpetright's directors intend to recommend unanimously that the shareholders approve the scheme.