Friday, September 10, 1999 Published at 09:13 GMT 10:13 UK
Business: The Company File
Prada shops for UK shoes
Church's has been making shoes for 126 years
One of Britain's oldest cobblers has agreed to a takeover bid from Italian fashion company Prada.
The bid values the 126-year old luxury shoemaker, Church's Shoes, at £106m. Prada offered 950 pence per share for the Church's stock it does not already own.
Last month, Prada took an 8.5% stake in the business. The offer price represents a 20% premium on its market price the day before it first announced the talks.
The Italian group said that adding the shoemaker to its operations would boost its brand portfolio.
Chairman John Church anticipated clear benefits from the support of a strong luxury goods partner, particularly abroad.
"Prada is committed to developing the Church's brand and to continuing footwear manufacture at Northampton," he said.
One other potential bidder could be waiting in the wings, Diego Della Valle.
The Italian shoes and bags company has declined to comment on whether it would make a counter bid for Church & Co.
In recent weeks, they have built up an 8.6% stake in Church's.
Previously, it has said it is eager to take over the UK company at a fair price and was willing to talk about co-operating with Prada.
Church's directors, who own 24% of shares, have said they will accept the deal. They will be released from their obligation to accept if a bid is made which exceeds Prada's offer by 5%.
Prada goes shopping
The news is the latest in a string of acquisitions by Prada and is said to underline its recognition that for luxury design companies, accessories and shoes often drive profits.
Prada recently acquired German fashion group Jil Sander and 51% of fashion house Helmut Lang.
Church's has 155 outlets around the world, 102 of which are in the UK. It prides itself on the fact that it takes eight weeks and 250 operations to make a single pair of shoes.
Other UK shoemakers, including Clarks, based in Somerset, have also been the subject of takeover rumours.
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