Five questions answered on the Marks & Spencer buy-out rumours
Shareholders could block it.
Due to real estate recovery a buy out of the UK retail chain Marks & Spencer has become increasingly more possible. We answer five questions on a possible future deal.
Why might Marks & Spencer be bought out?
According to The Telegraph, due to real estate recovery City insiders believe a buy out of the company could be ever more likely. They say a potential £2bn sale-and-leaseback deal for Marks & Spencer’s property portfolio could allow buyers to seriously run the rule over the company.
Is anyone currently considering investing?
Qatar is a contender, although it hasn’t shown any official interest, it is thought to have been approached. Qatar has pledged to heavily invest in the UK and already has a 29.9pc stake in Sainsbury’s.
What are the experts saying?
One expert that was not named told The Telegraph:
“If you raised £2bn through a sale-and-lease-back you would need £2bn of equity and about £4bn of debt,” they said.
“In theory it could be possible now – but there are still lots of issues.”
What issues are there to consider?
Marks & Spencer has a high number of retail shareholders who could block any deal. It also has a £290m pension fund deficit and its long-term strategy has been known to struggle in recent years.
How much are the retail company’s shares currently worth?
On Monday morning they rose to 8.5 per cent.