Ted Baker share issue proves popular, raises £105m

By

Sandra Halliday

Published
Jun 18, 2020

Ted Baker announced the results of its share placing on Thursday and while the firm’s shares have seen their values steadily falling for a number of years, it proved popular.

The struggling fashion retailer said earlier this month that it aimed to raise around £95 million by way of a share placing and an additional £10 million via an offer for subscription to the wider public with the new shares all priced at 75p each.

Acceptance for this offer closed on Wednesday and the company easily managed to raise the £105 million in total that it was targeting.

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It issued a total of 140 million new shares and overall, the share issue was oversubscribed. The new shares should start trading on Friday morning and they look like a bargain as the firm’s shares are currently trading around 113p, despite an almost-4% fall on Thursday morning. Of course, that perception of the issue as being a bargain price only holds true if the firm can turn itself around and the share price doesn’t tumble further.

The newly-issued shares mean that founder Ray Kelvin is no longer the biggest shareholder in the firm. He reportedly bought just £3.5 million of the new issue, diluting his stake from a substantial 35% down to 15.8%. Toscafund has almost doubled its stake to 26.4% and is now the retailer’s biggest stakeholder.

The cash raised should help the company navigate through the after-effects of the Covid-19 crisis and also give it the capital it needs to pursue its refreshed growth strategy that comes with a heavy focus on digital.