Moss Bros braced for share raid

CLOTHES group Moss Bros is bracing itself for a major sharebuying raid by fashion entrepreneur Kevin Stanford. It comes amid growing takeover speculation and a sudden souring of relations between the company and its biggest shareholder, Shami Ahmed.

Stanford, co-founder of the Karen Millen fashion store chain, has already taken a 5.6% stake in Moss Bros and is expected to boost that to double figures in the near future. He was linked with Ahmed's failed takeover approach in 2002 and between them they own 28% of the company.

Ahmed denied any link with Stanford this time round: 'He's nothing to do with me,' he told Financial Mail. Stanford could not be reached for comment.

But sources close to Moss Bros expect further significant action by Stanford or Ahmed within weeks.

The latest bout of share deals and speculation has also ignited the smouldering distrust between the Moss Bros board and Ahmed. Relations worsened last Thursday when Moss Bros wrongly told the stock market that Ahmed had cut his 22.6% interest in the firm.

Ahmed controls his stake through investments called contracts for difference with City broker and spread-betting group Cantor Fitzgerald. Cantor owns almost 21 million shares, which are controlled by Ahmed and, until last week, held four million related to other clients.

When Cantor sold several million, Moss told the market that Ahmed's interest had been cut by 1.1 million shares. In fact it was unchanged.

Charles Knott, head of the CFD desk at Cantor, said: 'I can't understand how things like this happen.'

Moss issued a public correction a day later. A Moss Bros spokesman said it was 'an innocent mistake'.

Shares in Moss Bros ended last week at 62p, valuing the group at £56.5 million.