Currys shares surge as Elliott, JD.com circle UK retailer

Elliott, which bought the UK bookstore chain Waterstones in 2018, said in a statement there was “no certainty that an offer will be made for Currys” or the terms on which any bid might be made.

Currys on Sunday rejected Elliott’s 62p-a-share approach, saying its £700m proposal “significantly undervalued” the chain and its future prospects.

Elliott has until March 16 to make a firm bid. Meanwhile, Beijing-based JD.com also confirmed it was in the "very preliminary stages of evaluating a possible transaction that may include a cash offer for the entire issued share capital of Currys" and will need to show its hand by March 18.

Last month Currys lifted full-year profit forecasts despite reporting a drop in sales as consumers cut back on discretionary spending amid high inflation and stagnant wage growth.

In an update for the 10 weeks to 6 January, the retailer said group sales declined by 4%, with those in the UK and Ireland down 3%, while the international segment saw a 6% fall. The Nordics and Greece fell 6% and 4%, respectively.

It has more than 800 stores around the world and employs 28,000 people. In the UK, it operates about 300 stores with 15,000 staff.

The company now expects adjusted pre-tax profit for the year of between £105m - £115m, above consensus expectations of £104m.

Reporting by Frank Prenesti for Sharecast.com