Page 29 - Patisserie Valerie Teaching Note
P. 29

Mike Ashley


                                                                      What was Mike Ashley's

                                                                      game plan in

                                                                      attempting to acquire

                                                                      Patisserie Holdings

                                                                      Group? Perhaps it was

                                                                      as simple as buying a

                                                                      company out of

                                                                      administration in order

                                                                      to "trim off the fat"?

               Other high street acquisitions spanning sportswear and

               luxury fashion to cycles have been subject to this

               experience.


                   -  Evans Cycle chain bought out of administration £8m
                   -  House of Fraser bought out of administration £90m


               Perhaps Ashley’s strategy was simply opportunistic, seeking

               out well-known brands. In the case of Evans Cycles the sale

               came with stock valued at £28m whilst House of Fraser, was

               bought carrying stock at a heavily discounted price which

               could then be sold for a handsome profit from.


               Unfortunately, Patisserie Valerie for a future buyer, is a

               difficult one to value because it does not have traditional

               stock that can be piled into a lorry and sold on. In fact, it

               carried about £8,000 of perishable cake stock.
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