Poundstretcher owner Instore has admitted it received a takeover approach, causing its shares to jump by two-thirds.
Huddersfield-based Instore, which has more than 100 stores across the UK, including a number in the West Midlands, said on Monday it was in “preliminary discussions” about a possible offer, but declined to reveal the identity of the potential suitor.
Speculation in the City focused on non-executive director Aziz Tayub, who joined the board last year and is the controlling shareholder of Crown Crest, which owns more than 30.8 per cent of Instore. Leicester-based Crown Crest is a discount food retailer specialising in the cash-and-carry market.
Currently the largest shareholder in Instore is Tradegro, with a 35.8 per cent stake. Tradegro is part of South African retail investment group Tradehold, which is headed by Instore’s non-executive chairman Christo Wiese.
Shares in Instore jumped by as much as 68 per cent on Monday, giving the company a market value of around £20 million.
In January this year Instore reported poor Christmas sales figures, causing its share price to slump by 14 per cent.
Instore is in the process of rebranding its Poundstretcher sites, which sell everything from kitchenware to home furnishings.
Last year Instore paid £3.8 million to the administrators of Ponden Mill, a soft furnishing retailer. It acquired 33 sites across the UK and saved nearly 400 jobs.