Currys has rejected a second takeover bid from US firm Elliott, stating that the electronics retailer’s offer is “significantly undervalued.” Elliott’s latest valuation of Currys stood at approximately £757 million, up from the initial £700 million earlier in the month. The US company faces competition from Chinese rival JD.com, which has also expressed interest in acquiring the British firm. Currys, with over 800 stores globally, has experienced slowing sales amid the cost-of-living crisis, witnessing a 3% drop in sales during the recent Christmas period compared to the previous year.

The electronics chain has been grappling with declining sales, a common struggle for high-street businesses, as consumers cut back on spending. Elliott, known for its activist investor approach, acquired UK bookshop chain Waterstones in 2018. The latest offer from Elliott valued Currys at 67p per share, an increase from the previous offer of around 62p per share.

Currys, acknowledging the second proposal from Elliott, stated that the board considered it and concluded that it undervalued the company and its prospects. Under UK takeover rules, Elliott has until March 16 to submit a final offer. Currys’ share price, trading around 47 pence per share before news of Elliott’s interest emerged, has risen and closed at 66.5p on Tuesday.

Danni Hewson, head of financial analysis at AJ Bell, noted that Elliott’s intentions toward Currys are clear, potentially sparking a bidding war. The situation could prompt JD.com to make a move, resulting in an intriguing competition that may drive up the price. Despite the challenges, Currys believes in its bright future, having increased its forecast profit for the year through cost-cutting measures.

Analysts acknowledge Curry‘s attractive market share and profitability despite its steeply discounted share price. The company may also benefit from an uptick in consumer spending as price rises ease, though competition from online retailers like Amazon poses a challenge. Currys, one of Europe’s major consumer electronics retailers, operates in the UK, Norway, Denmark, Finland, and Ireland, employing 28,000 people. It sells a range of electronics and has expanded into offering product maintenance, repair, refurbishment, and recycling services. Analysts estimate the value of its Care & Repair business alone at £667 million, with the mobile business potentially valued at about £500 million. Conversations with JD.com about a potential transaction reportedly began towards the end of the previous year, as the Chinese firm sought international expansion amid weaker demand in its home market.