* Shares up 13.5 pct; Yoox, Boohoo also rise
* ASOS hit by warehouse fire, profit warnings this year
* Short positions amplify stock move
(Adds detail, background, ASOS no comment)
By Francesco Canepa and Neil Maidment
LONDON, Aug 27 Shares in British online fashion
retailer ASOS, which have fallen sharply in recent
months after profit warnings and a warehouse fire, jumped on
Wednesday on an unconfirmed report of a U.S. bid for a stake in
ASOS shares, a previous market darling that have fallen by
almost two thirds this year, surged 13.5 percent to 26.65
pounds, pulling up other online fashion stocks in their wake,
including Boohoo and Italy's Yoox. ASOS
shares had already risen 7.6 percent on Tuesday on the
British financial website This Is Money said there was
"vague talk" of a U.S. cash bid in the region of 50 pounds ($83)
a share, adding that a U.S. buyer was believed to have
approached 27.4 percent shareholder Bestseller, a Danish fashion
business that also holds a stake in German rival Zalando.
Among companies the website said were interested were
e-commerce giants eBay and Amazon, which are
believed to be keen to expand into fashion, one of the fastest
growing areas for e-commerce.
ASOS declined to comment.
The company, popular with internet-savvy twentysomethings as
well as celebrity fans such as America's First Lady Michelle
Obama and British singer Rita Ora, has had a meteoric rise since
it listed on the stock market at only 20 pence in 2001.
It now sells more than 75,000 branded and own-brand products
ordered on nine local language websites, including in Russia and
China, shipping the goods around the world from a British hub.
The websites attracting a total of 83 million visits a month.
Jefferies analyst David Reynolds said the takeover talk came
as no surprise, given that U.S. companies are generating
international revenue that they might not want to repatriate
home because of taxation issues.
But Reynolds said he did not think that the "young, edgy"
ASOS brand would be a good fit for either eBay or Amazon.
"It just seems improbable. I think it's a cheap stock but I
think the prospect of a genuine M&A inbound offer coming from
the United States from Amazon or eBay is low," he said.
One trader dismissed the idea of a takeover, saying there is
more concern in the market over the potential for another profit
warning when ASOS reports quarterly figures on Sept. 16.
Another trader said the high interest in short positions in
the stock explained size of the share price move. Short-sellers
borrow a stock and sell it, betting they will be able to buy it
back at a lower price and pocket the difference, so any sharp
rise in the stock will prompt them to rush to cover their
positions, amplifying the upward momentum.
Of all outstanding shares in Asos, 6 percent are out on loan
- three times the market average.
ASOS shares fell sharply in June after a fire at its
Barnsley distribution centre in northern England and a warning
that full-year profits would miss forecasts, the latter wiping
1.2 billion pounds off its market value in a day.
ASOS had already spooked investors in March when it
announced plans to spend on infrastructure to meet future
demand, at the expense of short-term profits.
($1 = 0.6033 British Pounds)
(Additional reporting by Sudip Kar-Gupta; Writing by Emma
Thomasson; Editing by Pravin Char and David Goodman)