MusicMagpie surges 24pc as BT and private equity eye takeover

MUSICMAGPIE is in talks about a potential takeover by BT and private equity group Aurelius.

Shares in the second-hand smartphone and DVD retailer surged 24pc, or 4.5p, to 23.2p after revealing that discussions were ongoing, though remained at a ‘very early stage’.

BT and Aurelius, which owns Footasylum and The Body Shop, have until December 18 to make an offer for the Stockport-based group or walk away. Analysts said the Aim-listed retailer was a bargain as its shares have crashed over the past two years.

MusicMagpie made its stock market debut in April 2021 but shares have slumped by 88pc since. The firm has been hit by plunging sales of DVDs as streaming services gain popularity.

The firm was founded in 2007 in a garage in Stockport by Steve Oliver and Walter Gleeson. It sells refurbished consoles, computers and games, as well as second-hand CDs, DVDs and books.

But its fortunes have soured in recent years. Sales plunged 14pc to £61.9m in the first half of 2023.

It has also struggled to crack America as its US arm – called Decluttr – has faced similar battles with waning consumer demand. US sales slipped to £14.7m from £18.4m over the same half-year period.

Russ Mould, investment director at AJ Bell, said: ‘BT and its mobile brand EE deal in large volumes of phones, so having an in-house refurbishment business in the form of MusicMagpie would make sense.’