Pizza Hut parent eyes French Connection sale
The parent of the Pizza Hut business in the UK appears to be an unlikely bidder in the French Connection sale.
Private equity company Rutland Partners is reported by the Sunday Times to have been in talks to buy the troubled UK fashion brand since early this year.
French Connection, a decade ago infamous for its branding FCUK, has struggled for the last several years as its designers failed to capture consumers imagination with its offer. The brand seems caught in a rapidly shrinking middle market between fast fashion brands and the European-led luxury sector, its pricing aligned with neither end of the spectrum.
The company is thought to have been unofficially on the market for more than a year, although Rutland is thought to be offering as little as £40 million
A source told the Sunday Times it could not justify paying more than 40p a share for the business, which extended its losses five-fold last year on sales down 9 per cent to £164.2 million.
Besides Pizza Hut, Rutland also owns electronics chain Maplin and the Bernard Mathews turkey brand.
French Connection dates back to 1992 when it was founded as a womenswear brand by Stephen Marks, a year after the cult film of the same name was released. Menswear was added in 1976 and Marks grew the business to the point where its float in 1984 made him Great Britain’s 15th richest man. By the late 1980s it was in trouble and he bought back control of the business in 1991, launching the controversial FCUK brand and advertising campaign. That drove it back into a new era of success before consumers grew tired of the joke and it reverted to French Connection in 2005. By 2014 the retailer had 131 stores in the UK and Europe and it wholesales stock and supplies franchises internationally.
Ten years ago the company’s shares traded at £2.40 each, and Gatemore Capital Management, which holds 8 per cent, values the stock at £1.50.