Frasers Group has stated that it does not intend to make an offer for Revolution Beauty.

Last month, the beauty firm saw its share price drop by 97% since 2021, after reporting what one analyst described as an "ugly" trading update.

Revolution Beauty said it continues to have "constructive engagement" with a number of other interested parties. However, it also stated that there is no certainty an offer will be made for the company.

Following the announcement, Revolution Beauty's share price dropped by over 32%.

Investment director at AJ Bell, Russ Mould, said that although Frasers confirmed it was in the running with other businesses to make an offer last week, it "obviously didn’t like what it saw".

He stated: "There are two possible scenarios to consider. One is that Frasers has found some skeletons in the closest and is betting on Revolution Beauty going bust, which would mean it could potentially buy the business at a much cheaper price out of administration. The other is that Revolution Beauty needs a significant amount of money to dig it out of a hole and Frasers simply isn’t prepared to make that investment."

Mould added that Frasers was one of two potential buyers, with Boohoo being the other.

Although Boohoo currently owns 29%, Mould believes that it may not be looking to further invest.

He concluded: "Boohoo is trying to fix its own problems and its investors might not welcome the acquisition of Revolution Beauty just at the point where the mothership is finally getting back on its feet."

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