(Reuters) -Britain’s Mulberry said on Thursday it has raised 20 million pounds ($27.14 million) through convertible debt from its two biggest shareholders as it seeks to bolster operations and support growth.
Shares of Mulberry fell 5.1% to 92.5 pence apiece by 1309 GMT.
The high-end luxury bag maker also reported an 18% fall in group revenue for the nine weeks ended June 1, as rising inflation and broad economic uncertainties continue to weigh on consumer spending.
Like its larger rival Burberry, Mulberry is also refocusing on its ‘British heritage’ to resonate with domestic consumers, reversing a recent pivot it took to expand into the Asia-Pacific market.
The company issued new convertible loan notes to the two investors, the company said, adding that it plans to raise an additional 1.2 million pounds from other minority shareholders through an offering of ordinary shares.
Challice is Mulberry’s biggest shareholder with a 56.43% stake, followed by Frasers’ 37.05%, according to LSEG data.
“The board has concluded that the fundraising and the retail offer are in the best interests of all stakeholders and will promote the success of the company,” Mulberry said, as it also appointed Frasers executive James France to its board.
The company on Thursday reported a 21% drop in fiscal 2025 revenue to 120.4 million pounds and underlying pretax loss of 23.7 million pounds, in line with its own forecasts given in June, when it had also announced the fundraising plans.
($1 = 0.7370 pounds)
(Reporting by Unnamalai L and Pushkala Aripaka in Bengaluru; Editing by Anil D’Silva and Leroy Leo)
