Baugur, the Icelandic retail group best known for its raids on the British high street, has confirmed its ambitions to expand into the US, disclosing discussions on a possible joint bid for New York’s Saks Fifth Ave with Dubai retailer Landmark Group.
Baugur, led by Jon Asgeir Johannesson, has made a fresh filing with the SEC, disclosing an interest in 12.2m shares – or 8.5 per cent – in Saks. Landmark, controlled by Micky Jagtiani, already has a 1.2 per cent stake in Saks.
The Icelanders, who have built their Saks position through a derivative agreement with Landesbanki, said:
Baugur purchased the shares as part of its global investment portfolio and believes them to represent a sound acquisition. After purchasing the shares and becoming more familiar with the Issuer, including through meetings with members of the Issuer’s management, Baugur determined that it would like to explore the possibility of making a proposal for the acquisition of the Issuer. In furtherance of the foregoing, Baugur has had exploratory discussions with Milestone Resources Group Limited (Landmark), which is currently a shareholder of the Issuer and principally owned by Micky Jagtiani, the principal owner of the Landmark Group, to explore the possibility of making a joint proposal with Landmark and/or one or more affiliates of Landmark for the acquisition of the Issuer.
Baugur expects to seek to engage in discussions with the Issuer’s management and members of the Issuer’s Board of Directors with respect to a possible acquisition of the Issuer. In addition, Baugur has consulted with financial and legal advisers and expects to hold discussions with Landmark and other third parties with respect to the financing of a possible acquisition.
The filing shows that while Baugur was paying $16 for Saks stock in mid-September, it has recently paid just over $22 per share.
Baugur’s interest in Saks first emerged in July, although associates of the Icelanders indicated at that the time that rather than bidding, Jon Asgeir was really targeting some sort of brand-sharing deal with the Americans.
On Monday, shares in Saks rose more than nine per cent during after-hours trading.