The inevitable has happened. XXL’s majority owner, Altor, has accepted Frasers Group’s bid for its stake in XXL, making Frasers the new majority owner of XXL.
After negotiations stretching from the autumn of 2024 til yesterday, the Norweigan sports and outdoor chain XXL has a new majority owner in British Frasers Group, as the Swedish private equity firm Altor finally accepted Frasers’ mandatory offer to purchase its stake in XXL ASA – 23,491,568 A shares and 17,051,037 B shares. These are all of Altor’s shares and votes in the company, priced at NOK 10 (€1) per share. Altor will therefore no longer own any shares in XXL.
For its 40.5 million A and B shares Altor will be receiving approximately NOK 405 (€39.0m). If we take into account dividends received in 2021 and 2022, Altor has lost an estimated NOK 1.45 billion (€125.9m) on its investment.
The background of Altor´s move is that on the morning of May 27, it became clear that XXL needed an additional NOK 200 million (€20.0 million) to cover an acute liquidity shortage. All NOK 600 million (€60.0m) raised in the latest issue in January had been used up.
In a press release, Altor’s Øistein Widding, Partner and Head of Norway, explains the decision to leave XXL.
“Given the current situation and the increasing short-term challenges, Altor has decided to accept Frasers Group’s offer, in line with the Board’s new recommendation. As we now hand over to Frasers Group, we believe XXL will benefit from their industry experience and benefit from being part of a larger group” he said.
Andreas Källström Säfweräng, Partner and Head of the Consumer Sector, continued: “XXL’s management team and dedicated employees are working hard every day to build a stronger company, and Altor believes they’ll succeed in getting back to profitable growth. That said, there are still real challenges ahead short-term. We see this as the right time for Frasers Group to guide the next chapter.”
On Monday evening, May 26, the board changed course and gave its recommendation for the bid, when it became clear that Altor was also reconsidering its bid. XXL’s chairman, Håkan Lundstedt, calls Frasers’ increased ownership a “clear expression of confidence in XXL’s potential and direction.”
“Frasers Group now becoming the majority owner of XXL will enable us to accelerate further, with an owner who has strength, experience, and belief in what we are building,” he said in a statement.
The future of XXL will be interesting for sure. How will Frasers change the XXL offer to its customers? Will Frasers go on with the XXL brand, or will Norwegian and Swedish end-customers see Sports Direct logos for the first time in Oslo, Stockholm, Gothenburg and more? Time will tell.
