LONDON — Mothercare, a British seller of maternity and children's products, said on Monday that it would focus on its own turnaround efforts after Destination Maternity dropped an acquisition bid late Friday.
Destination Maternity, the operator of A Pea in the Pod and Motherhood Maternity stores in the United States, approached Mothercare about a takeover earlier this year but was repeatedly rebuffed by the British company. Late Friday, Destination Maternity said it was abandoning those efforts.
Destination Maternity had hoped to join a growing number of American companies that have sought to reincorporate overseas to avoid higher corporate taxes in the United States through so-called inversions. The rush of mergers and acquisitions that provide a base overseas has drawn concern and criticism from politicians in Washington.
"Mothercare is now fully focused on the company's plan to turnaround the U.K. business and to continue its strong international growth," Mothercare said in a statement on Monday. "The board remains confident in the ongoing execution of Mothercare's strategy as an independent company."
Mothercare has struggled in its home market in recent years, even as it has seen gains from its international and direct sales operations. Sales in Britain were down 7.5 percent to 462.3 million pounds, or about $785 million, in the fiscal year that ended in March.
The company has sought to close unprofitable stores and cut costs in Britain, while expanding overseas.
Earlier this month, Destination Maternity, which is based in Philadelphia, said it had submitted two nonbinding written proposals to Mothercare about combining the companies but was rejected by Mothercare's board.
In the latest proposal, submitted on June 1, Destination Maternity said it was willing to pay £266 million, or about $456 million, in cash and stock for the company.
After it made it intentions known publicly on July 2, Destination Maternity said that its financial adviser canvassed shareholders of Mothercare and found that "shareholders of Mothercare believe that only a very significant increase in the value of such proposal would be acceptable."
Destination Maternity said late Friday that it was unwilling to increase its offer and withdrew the bid, noting that Mothercare's board of directors was unwilling to allow a comprehensive appraisal of the business ahead of a potential deal.
Mothercare said on Monday that its board had had no contact with Destination Maternity since June 3, shortly after the most recent offer.
source : http://rss.nytimes.com/c/34625/f/640316/s/3cee338f/sc/8/l/0Ldealbook0Bnytimes0N0C20A140C0A70C280Cmothercare0Efocuses0Eon0Eturnaround0Eafter0Edestination0Ematernity0Edrops0Ebid0C0Dpartner0Frss0Gemc0Frss/story01.htm
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