Shares in the Liverpool-based discount department store group TJ Hughes surged today, after a company backed by its former chairman appeared ready to table a bid.
City investment bank MacArthur & Co said it was acting for a “recently incorporated unquoted company” that was considering an offer, likely to be an all-share package.
The company is backed by Eric Hodges, who stood down as chairman of TJ Hughes in 1999, as well as MacArthur and a group run by former ING analyst William Currie. Hodges was managing director when the retailer floated in 1992.
Shares shot up 10% today, despite TJ Hughes reminding shareholders that any bid was unlikely to contain a cash element. The move comes just two months after it emerged that the department store group had overstated the value of its stock, an error that cost it £3.6m.
The mistake was revealed as the group – which has 40 stores mainly in the north – reported a fall of nearly 30% in annual pre-tax profits to £4.2m. Turnover rose to £157m, from £126m.
TJ Hughes chief executive George Foster, who will open the groups second biggest store in Glasgow tomorrow, was unavailable for comment.
EGi News 16/05/01
