The UK’s Frasers Group has been interested in buying struggling Norwegian sports retailer XXL ASA since last year and despite being rebuffed and walking away before returning to the pursuit, it’s now close to achieving its goal.
But there was a sting in the tail of the announcement of its majority stake on Wednesday with the company also saying it’s unsure whether the business can be salvaged, even though it intends to wor with stakeholders to try.
First, some background. Frasers said in December it planned to make an offer to buy all the shares of the troubled business that it didn’t already own at a 25% premium to the then-share price, following a shareholder revolt over management’s plans to fund a turnaround.
But the company rebuffed Frasers with its board instead opting for a rights issue that the UK company had spoken out against. Then in February, with it being clear that its offer wouldn’t succeed, the British firm walked away.
However, it participated in the rights issue, which took its stake above 30% and in March said it would make a mandatory offer for the rest of the shares.
That brings us to today with Frasers saying acceptances of its offer mean it will end up controlling more than 92% of the share capital and 90% of the voting shares.
So what about that announcement that XXL ASA might not survive? In the same stock exchange release that contained the information about its stake, Frasers said: “Reference is made to XXL’s announcement dated 26 May 2025 in respect of XXL’s challenging liquidity situation and supply chain delays. Having offered to provide support to help XXL navigate its challenges over the past 18 months, and been rebuffed, this is a situation which Frasers believes could have been avoided. In the meantime, XXL has not been able to execute on its proposed turnaround plan and XXL’s financial and trading position has continued to deteriorate.”
It added that it’s “acquiring a business which is in significant distress. As such, all stakeholders, including but not limited to, brand partners, landlords, suppliers and partners, will need to work collaboratively with Frasers in its efforts to save the XXL business in its current form. Frasers does not currently have sufficient information to be able to determine how much of a viable proposition XXL in its current form is, and whilst its current intention is to work on stabilising the XXL business, this will be more difficult given the passage of time, and there is no guarantee that XXL can be saved in its current form or at all.”
That’s worrying news for the aforementioned “brand partners, landlords, suppliers and partners” although it’s unclear how much of that is a warning to encourage a co-operative attitude and how much it might mean that Frasers could shutter the business.
We’ve already seen the UK group being prepared to close retail chains and brands that don’t pull their weight — illustrated most spectacularly with its acquisition of Matches and relatively rapid ageing of the luxury webstore.
We’ll be watching this one very closely.
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