Frasers upped its stake in Hugo Boss but fell short of taking full control of the German fashion brand, as Mike Ashley's retail group pushes further into the luxury sector.
In an update to investors, Frasers said it had increased its shareholding in the company, bringing the group's stake to nearly 48 per cent.
Last month, Frasers owned around 36 per cent of Hugo Boss, breaching the 30 per cent threshold after which companies are required to make a mandatory takeover bid under German takeover law.
It offered to pay around £1.7billion for the remaining shares, equivalent to €38 per share.
Hugo Boss's management and supervisory board said the deal was 'inadequate from a financial point of view' and urged shareholders to reject it.
Last week, 17.6 per cent of Hugo Boss investors had tendered their shares in support of its €38 per share takeover bid.
This morning, Hugo Boss chair Stephan Sturm said: 'We appreciate Frasers Group's continued long-term commitment to Hugo Boss and look forward to maintaining a constructive relationship with them as our single largest shareholder.'
Mike Ashley is pushing into the luxury sector as it ups its stake in Hugo Boss
It said it will continue to execute its strategy, launched in December 2025, aimed at delivering sustainable growth and long-term shareholder value.
The FTSE 250 retailer has built its holding in Hugo Boss, which it stocks in its Flannels and Frasers shops, since its first investment in 2020, sparking speculation it would one day make a formal offer.
Ashley had reportedly been hoping to install Michael Murray, his son-in-law and Frasers boss, as chief executive of Hugo Boss.
Frasers is ramping up its presence in the luxury market just days after buying luxury department store chain Harvey Nichols.
Axel Rudolph, chief technical analyst at IG, said: 'Combined with its existing holding, Frasers now controls almost half of the German fashion group, putting it firmly in the driving seat as it looks to increase its influence.
'With no material changes to the offer announced, the latest figures suggest Frasers' long-running interest in Hugo Boss is continuing to move closer to its ultimate objective.'
Ashley's £40million rescue deal to buy Harvey Nichols came after the chain warned it would run out of money if it failed to secure new investment.
The acquisition forms part of Frasers' 'elevation strategy' aimed at increasing its presence in the luxury market, building on the growth of its Flannels brand.
However, Murray warned the deal would require 'tough choices', adding: 'We are prepared to make those decisions, even if it means a smaller business in the near term.'
Last month, Frasers took a 4.1 per cent stake in Burberry as it doubled down on its investment in high-end firms.
Frasers shares rose 1.2 per cent to 804p, bringing year-to-date gains to 20 per cent.
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