US Edition 
Mothercare to face increased takeover bid
The retailer has already rebuffed two previous attempts but Destination Maternity could raise its offer after meeting major investors this week
Mothercare is facing a fresh takeover bid from US rival Destination Maternity after two of its previous attempts were rejected amid investor concerns over the bid amounts.
The Philadelphia-based company approached Mothercare twice in June with a £270m takeover offer, but board members said that it undervalued the business.
The board members have been backed by investors Fidelity and Allianz – who between them own more than a fifth of the British chain’s shares – with the firms dismissing the takeover attempt as “opportunistic and “inadequate”.
However, Ed Krell, Destination Maternity’s chief executive, is reportedly flying into London this week for crunch talks with Mothercare’s major investors. It is understood that shareholders will not be easily convinced that a reasonable deal can be struck.
Last week, Mr Krell had called on Mothercare investors to press the board into talks. However, the City charm offensive has failed and the public show of support for the retailer by shareholders will be hugely disappointing to the Americans.
UK takeover rules mean that Destination Maternity faces a deadline of 5pm on July 30 to come back with a final firm offer. If it fails to do so, it cannot return with a new offer for another six months.
The deal is another example of a US company looking to take advantage of the “inversion” advantages offered by UK’s lower corporation tax rate.
Mothercare has been beset by problems during 2014. It issued a profits warning on the back of a disappointing Christmas and ousted its chief executive Simon Calver.