Mickey Drexler - J Crew sale to fall through
The sale of American brand J Crew to Uniqlo's Fast Retailing could be set to fall through following rumours that J Crew are preparing to sell shares on the stock exchange.
J Crew's sale to Fast Retailing could be set to fall through.
The Japanese retail giant - which owns the brand Uniqlo - were in talks to purchase the American label, but as they are reportedly unhappy with the asking price of $5 billion it is now likely that J Crew will sell shares on the stock exchange, according to Women's Wear Daily.
The multi-brand are said to be heading for an Initial Public Offering (IPO), where shares in the company are sold to the general public in order to make the switch from a private to a public company.
Although Fast Retailing would gain from the deal, as J Crew's knowledge and expertise would help Uniqlo to expand in the United States, rumours of an IPO will reportedly bring negotiations of a deal to a standstill.
Compiling the relevant paperwork for the IPO would be a quick task as the company already files their annual financial results with the Securities and Exchange Commission because of their publicly held debt.
The brand's earnings have slowly been decreasing over the past two years and if they slow any more before the business is floated on the market it would harm the price of shares, and therefore it has been reported that CEO Mickey Drexler will be keen to try and finalise a deal with Fast Retailing as soon as possible.