Is Office shoes tiptoeing towards a deal..?

Truworths, the South Africa-based fashion retailer, has released a “cautionary announcement” of a potential acquisition of Office Retail, the UK shoe retailer. 

Office was acquired by Silverfleet Capital for a reported £300m in a secondary buy-out from West Coast Capital in December 2012. West Coast had first taken the company into private equity ownership back in April 2003, having paid the relatively modest sum of £15m. August last year saw the start of speculation that Silverfleet was looking to exit Office via a planned IPO on the London Stock Exchange; this exit strategy marched on until around January this year, then it went quiet until the announcement by Truworths. 

While Truworths shareholders (Truworths is a Johannesburg Stock Exchange-listed company) are being advised that the firm has “has entered into preliminary non-binding negotiations”, should these negotiations come to fruition, Truworths would be clocking up its third deal of 2015. However, having paid £16m for Earthchild Clothing in March and then £1.75m for Naartjie in April, if £300m is the price being talked about for Office, then this deal would really need to fit like an “old comfy pair of shoes” for shareholders to approve it.