Body Shop rejects bids

February 12, 2002 Posted: 1254 GMT

LONDON (CNN) -- The Body Shop, the natural cosmetics retailer, on Tuesday said it was no longer entertaining takeover bids and announced a management shake-up.

For the second time in nine months, The Body Shop said it had called off talks with a number of identified bidders because they had valued the UK company too low.

In June of last year, The Body Shop broke off talks with Mexico's Grrupo Omnilife, a fast-growing seller of direct-to-consumer nutritional supplements, which had offered $500 million for the company.

The Body Shop said it is now looking to overhaul its operations and continue as an independently operated company. It said founders Anita and Gordon Roddick were resigning as co-chairmen and handing control of the company to a new management team.

Adrian Bellamy, who sold U.S. joint venture Bellamy Retail Group to the Body Shop in July, will succeed the Roddicks as executive chairman. Peter Saunders, currently chief executive of The Body Shop in North America, will replace Patrick Gournay as group CEO.

The Body Shop's shares were down 9.3 percent to 89.4 pence in midday trading on Tuesday in London. The stocks has been as high as 136 pence and a low as 70 pence in the past year.

The Roddicks founded The Body Shop in 1976, and throughout the 1980s they expanded the company rapidly across Europe and the U.S.

However, it began to loose market share as competition grew and retailers --like supermarket chains Tesco and Sainsbury and drug retailer Boots --began offering competing product lines.

The Body Shop's net income in the six months to September 1 fell to £1.9 million ($2.8 million), or 1 pence a share, from £4.7 million, or 2.5p, in the year earlier period. Sales rose 1 percent to £302.6 million, while sales at stores open for more than one year slipped 2 percent.

Over the critical Christmas shopping periods, the company posted no better than flat sales.