Just weeks after reports McColl’s was at risk of collapsing into administration, the convenience retailer saw its share price jump over 60% yesterday. The company said it had no idea why, although last month it did admit to having recently received a takeover approach – which was from forecourt giant EG Group – but discussions ended without an agreement.
The group has been hunting for a buyer whilst seeking a new financing solution to ease the burden of heavy debts. Wholesale supplier Morrisons is reported to be watching the situation closely and could pick up the 200 McColl’s stores converted to the Morrisons Daily format if the business collapses.
In a brief statement on Thursday, the convenience retailer said: “McColl’s notes the recent rise in the company’s share price and confirms that it does not know of any reason for this price movement.
“As previously announced, the group remains in ongoing dialogue with its lenders with a view to achieving a longer-term agreement in relation to the balance of its existing facility, however, there is no certainty as to the successful outcome of these discussions.”
The company added that a further update will be made as and when these discussions conclude.
Last month, McColl’s Chief Executive Jonathan Miller stepped down after the business endured torrid trading conditions and supply chain issues last year that impacted both its revenue and profit.
NAM Implications:
- A share price rises when buyers exceed sellers.
- Like when a potential predator is accumulating a stake…
- However, such interest must be revealed as soon as a 3% stake is acquired.
- i.e. any time soon…
