Jan Cameron has boosted her stake in Pumpkin Patch to nearly 10%, renewing old speculation she may be looking at a takeover or at least a pick up on the cheap.
Mrs Cameron has sunk a further $4.54 million in to the company, to increase her shareholding to 9.06%, putting her in the same league as Briscoe chairman Rod Duke who also holds nearly 10% and Setar Montani with around 12%. The rest is made up of institutional investors.
Mrs Cameron announced a 6.3% shareholding in the company back in July, leading to speculation of a takeover, a discussion set to be renewed amongst analysts.
Pumpkin Patch has been suffering, like most retailers in the current retail climate, exacerbated by less than satisfactory expansions into the US and UK markets.
The company bought back 8.45 million shares in November in attempt to get the share price over the $1 hurdle, and was also forced to cut 30 jobs at its head office in October after announcing a 27.5% fall in profit for the year, down to $17.1 million.
At the company’s annual meeting the fall was attributed to a difficult trading environment, especially in the US, supply chain issues and higher interest charges and costs.
Mrs Cameron, founder of iconic outdoor brand Kathmandu, NBR Rich List member (at number 24) and business community recluse has developed a reputation for prudent investments, which may give Pumpkin Patch shareholders something to cross their fingers over.
Mrs Cameron is famously tight-lipped about her investments, and almost never comments to the market or media.
Pumpkin Patch initially listed at $1.25 in 2004 before peaking at nearly $5 in 2007 – since then it has slumped severely and bottomed out at 80c in November.
ABN Amro Craig’s head of research, Mark Lister, believes any takeover bid would be difficult, given the diversity and strength of the other shareholders and believes she may be looking to stake out a solid cornerstone in a company she fancies.
“Let’s not kid ourselves, the retail environment is challenging at best. She may be taking a long to medium term view of a company she definitely sees some value in,” he said.
Pumpkin Patch’s expansion hasn’t worked out as well as they’d have liked, and there may be some retrenchment as the company moves back to focusing its knitting, he said.
“The company’s fundamentals are good. But there is certainly some downside risk to any investment in the retail sector. Anyone investing is looking at the long term.”
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