A proposed takeover bid for womenswear chain Noni B has escalated - with yet another acquisition in sight.
Noni B has urged shareholders to take up the $16.4 million offer from private equity firm Alceon Group.
Alceon has revealed it is planning to acquire womenswear group Universal Brands via Noni B for $1.7 million.
Universal Brands operates the Events and Queenspark chains.
Noni B chairman Joycelyn Morton said the 51 cents a share offer was in the best interest of shareholders, given the current outlook for the company.
“Beyond the attractive premium, the Noni B board is recommending Alceon Bidco’s offer to shareholders because it provides certainty of value for shareholders in a very difficult retail environment,” she said in a letter to shareholders.
“That value certainty is available to all shareholders at a time when they would otherwise face an uncertain outlook in relation to dividends and the potential capital requirements of the business.”
Alceon warned shareholders who rejected the offer could be disadvantaged.
This would be in the event the private equity group gained a majority shareholding in the company just short of 100 per cent.
Alceon warned minority shareholders may be asked to contribute to planned capital raisings and faced having their holding diluted if they refused to participate.
Noni B reported a $2.1 million loss for fiscal 2014, with sales down 7.7 per cent.