American fashion company Abercrombie & Fitch halted talks with potential buyers and says it will continue its current strategy. The decision had an immediate negative impact on the brand’s share.
Increasingly lower value
In May, Abercrombie & Fitch confirmed it was willing to sell and several parties immediately expressed an interest. Analysts also felt an acquisition was the only viable way to save the company since it struggled with lower turnover and huge losses.
However, the Abercrombie & Fitch and Hollister parent company, failed to reach an agreement with any of the interested parties and an acquisition now seems like a long way off. The stock exchange did not take the news well, hammering the share by about 20 %.
Several years ago, the notion that someone could acquire Abercrombie & Fitch was unfathomable. Its value in 2011 reached about five billion euro, but that has crashed to 570 million euro by now. Shares of similar fashion companies also took a hit, because investors have very little faith in the overall industry.
