Retailer FatFace abandons its planned £110m flotation

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​​Fashion chain FatFace has ditched plans to join the stock market in the latest sign that the City’s appetite for new listings is starting to cool off.

The business, which has been majority owned by private equity firm Bridgepoint since 2007 and has former Marks & Spencer’s boss Sir Stuart Rose as its chairman, said current market conditions are largely to blame for the decision.

Recent retail floats have proved disappointing. Wakefield-based Card Factory, which has more than 700 stores, now stands at less than 200p a share, valuing it at just under £700m. The group joined the market at 225p.

Pets at Home, Poundland and Appliances Online have 
floated in recent weeks, while online property search firm Zoopla and discount chain B&M confirmed their intention to join the stock market in the coming weeks.

Holidays-to-insurance firm Saga cut the target price on its flotation on Wednesday in order to ensure a positive after market performance, although it said demand from retail investors had been “exceptional”.

The decision by FatFace, which specialises in outdoor clothing, to pull its £110m float adds to signs that the window for flotations may be closing.

The company​ was going to use the float to expand its international expansion​. T​he​ proposed​ listing valued the firm at ​£​440​m.

Bridgepoint paid rival private equity firm Advent ​£​360​m for Fat Face in 2007, but the investment has proved difficult as the retailer struggled to find its niche.

Bridgepoint subsequently injected three further investments of ​£​25​m in total.

Fat Face, which sells clothes targeted at an active lifestyle, recently abandoned attempts to target younger shoppers and returned to its middle-aged core market - guided by ​Sir​ Stuart, who joined ​the group in 2013.

The firm said it had decided to pull its offer despite a strong level of interest from institutional investors.

“Current equity market conditions are the principal factor in the decision​,” it said​. “​The board remains confident in the prospects for the business and will continue to execute our growth plans.”

Date:  20th May 2015. Picture James Hardisty, (JH1008/67g) Richard Flint, Chief Executive of Leeds Based Sky Bet & Gaming.

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