The Specialty Fashion Group Ltd (ASX: SFH) share price has gone up by 21% today after the company made an important announcement to the market.
Firstly, the company re-iterated that it has been undertaking a structural review and assessment of all option and opportunities to improve shareholder value. During that review the business received a number of 'confidential, non-binding indicative proposals for a change of control of the overall company or the acquisition of certain brands.
Specialty Fashion Group today confirmed that an offer has been received from Anchorage Capital Partners for the acquisition of City Chic and Autograph for $100 million in cash. The proposal is expressed as being binding and is valid until the end of this Friday according to the release.
However, the Specality Fashion Group Independent Review Committee (IRC) noted that there are a number of things that need to be agreed with Anchorage and there are a number of conditions. Therefore, the IRC doesn't believe that an agreement will be reached within the timeframe of the offer.
The company said that the IRC continues to consider all options to improve shareholder value. Specality Fashion Group re-iterated that there is no certainty that any proposal will result in a binding transaction.
Foolish takeaway
This seems like a very good offer for just two brands belonging to Speciality Fashion Group, which is why the share price rose so much today. I'd take the money if I were management, but I wouldn't want to buy shares just because of this news. The share price increase now reflects the offer.
