Embattled fashion retailer French Connection’s (FCCN) planned sale (9 Apr) of its 75% stake in women’s clothing-to-homewares brand Toast has been well-received.

The shares had advanced to 52p as Shares went to press. The disposal will sharpen French Connection’s focus on its core brand and could drive a resumption of dividend payments from the clothing and accessories label.

Conditional upon the nod from shareholders, the £23.3m sale of Toast to Denmark’s BESTSELLER will yield £13.9m in net cash proceeds for French Connection and support the £47.5m cap’s return to sustainable profitability.

If the sale is approved, French Connection says it will seek to reinstate the shareholder reward, shelved back in 2012, once the group has been successfully returned to profitability.

Retail industry conditions are tough, especially in the UK, yet the north London-based fashion house’s underlying operating loss narrowed by £3.1m to £600,000 in the year ended 31 January.

During the year, French Connection received an unsolicited bid from an unnamed US group, but the suitor ultimately walked away from a deal.

A honed focus and further turnaround progress could potentially attract other predators, although founder, chairman and CEO Stephen Marks holds sway with a 41.6% stake and Mike Ashley’s Sports Direct International (SPD) has built up its stake to a smidgeon over 27%, just shy of the 30% threshold requiring a bid. (JC)

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