Bonmarche gives backing to bid by Edinburgh Woollen Mill Group billionaire Philip Day

The group said it now recommends shareholders accept the 11.4p-a-share offer tabled in April, which remains open for acceptance, after a “poor” first quarter has cast doubt over its full-year profit out-turn and the group’s financial stability.

Bonmarche warned that its auditor had said it was likely to include a reference to the “uncertainty with regard to going concern” due to the trading troubles.

Bonmarche said: “Whilst the board’s view remains that the offer does not adequately reflect the potential longer-term value of the business, the increase in uncertainty that has developed reflecting the trading and financial position of the business during the first quarter of the financial year makes the certainty represented by the offer potentially more attractive in the short term.

“As a result, the board of Bonmarche, which has been so advised by Investec as to the financial terms of the offer, is now of the view that the terms of the offer are fair and reasonable.

“The board therefore recommends that shareholders accept the offer, as they intend to do so in respect of their own beneficial holdings.”