News Column

MySale debut a decimal disaster

June 17, 2014

By Rupert Steiner, Daily Mail, London

June 17--Sir Philip Green's return to the London Stock Exchange was mired in chaos after the Australian fashion website he co-owns was wrongly priced on its market debut.

Shares in MySale fell sharply after adviser Macquarie expressed the share price in the wrong format. That caused automatic trading systems to dump the stock because they thought it was trading at a fraction of the anticipated value.

Share prices should be quoted in pence - in MySale's case, 226p. But an underling at its nominated adviser, Australian investment bank Macquarie, quoted it in pounds and keyed pounds sterling 2.26p into the trading system. The mistake meant some computer systems became confused over the decimal point and did not trade the stock, while others read the price as 2.26p. triggering automatic selling.

The shares fell by as much as 27pc and the mistake could not be corrected until trading had finished for the day.

MySale, which runs 'flash sales' of discounted items to its members on behalf of fashion labels, is raising pounds sterling 40m on the smaller Alternative Investment Market in a placement that was supposed to value it at pounds sterling 340m.

Last month, Green, who owns the TopShop and BHS chains, bought a 25pc stake in the business through Shelton Capital, an investment vehicle owned by a family trust.

As part of Green's investment he has a merchandising agreement to supply MySale with excess inventory from his Arcadia empire, which includes BHS, Miss Selfridge and Wallis.

MySale's co-founding brothers Carl and Jamie Jackson said this agreement currently excludes Topshop merchandise.

MySale was forced to issue a statement saying: 'MySale Group trading currency is currently in GBP, as opposed to British pence as intended. The quote will be changed to British pence... Tuesday 17 June 8am.'

The City's appetite for retail floats has recently cooled with Pets At Home falling on its debut and AO World trading below its offer price.

It is impossible to know how much of the fall in MySale's share price was due to float fatigue and how much to Macquarie's blunder.

One investor said: 'Why would the stock be trading down if it was oversubscribed?'

MySale, which faces competition from other online fashion sites, holds up to 60 flash sales a day and has 10.5m members.

The firm was set up in Australia in 2007 by British born entrepreneur Jamie Jackson, who is executive vice-chairman, and his brother Carl, who is chief executive. In the UK it launched with a warehouse in Corby and has around 100 employees.

In the year to June 2013 the firm made revenues of pounds sterling 102m and operating profit of pounds sterling 4.9m.

MySale recently acquired Cocosa, a rival owned by former Harrods boss Mohamed Al Fayed ahead of an expansion drive.

A raft of retailers have come to the market in recent months, from Poundland to McColls, but fashion chain Fat Face abandoned plans due to lack of interest. Online department store The Hut, which many had expected to float, also said it has no plans to list this year.


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Source: Daily Mail (London, England)

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