Daily Mail - 30.07.2019

(^) Daily Mail, Tuesday, July 30, 2019
He pledged to save the High St. But as Sports Direct shares tank...
pected £605m tax bill and an admis-
sion that it was a mistake to have
bought House of Fraser last year
for £90m.
David Cumming, chief investment
officer of Aviva Investors, said:
‘Mike Ashley has obviously got
retail talent, or had retail talent,
but Sports Direct has lost its way.’
He described the group as ‘almost
a case study in failed corporate
governance’, adding: ‘Anyone who
cares about proper oversight, con-
trol and governance of the chief
executive shouldn’t really be an
investor in this company.’ While
Sports Direct’s value has been
pummelled, Ashley has been on a
buying spree.
He has made a name for himself
scooping up troubled firms such as
House of Fraser, which he bought
by Hannah Uttley
How Mike
Ashley’s
dream
died
THE chief executive of
an aerospace trade
body has called on the
Government to inter-
vene in the £4bn takeo-
ver of Cobham.
ADS Group boss Paul
Everitt urged ministers
to secure ‘appropriate
commitments’ from the
buyer of the Devon-
based defence contrac-
tor, which is a leading
supplier of air-to-air
refuelling technology
and satellite hardware.
Under plans revealed
last week, Cobham is
set to be taken private
by US-based private
equity group Advent
International if enough
shareholders support a
deal. But the bid –
which is opposed by
Cobham’s biggest
shareholder Silchester
International Investors

• has sparked concerns
  about the impact it
  could have on British
  jobs and expertise.
  Everitt said he sup-
  ported the deal and
  hailed Cobham as a
  ‘fantastic business’.
  But in a tweet he said:
  ‘Cobham is a major UK
  industrial asset and the
  new government should
  secure appropriate
  commitments from its
  buyers.’ A government
  spokesman said it was
  ‘closely monitoring’ the
  takeover process.

THE pound crashed to

a two-year low against

the dollar after minis-

ters said they assumed

there would be a No

Deal Brexit.

Sterling was trading

at close to $1.50 on the

day of the EU referen-

dum in 2016 but yester-

day dropped below

$1.23. That was the low-

est level since March

2017 and will hit British

families buying foreign

currency for their

summer holidays.

The Mail last week

revealed families are

facing the most expen-

sive foreign summer

holidays for years

because of the fall.

The latest slide,

which also saw the

pound fall towards

€1.10, came as the For-

eign Secretary

Dominic Raab accused

the EU of being ‘stub-

born’ for refusing to

renegotiate the with-

drawal agreement

they struck with

Theresa May.

Experts have warned

a No Deal Brexit would

potentially tip the

economies of Britain

and other European

nations such as Ger-

many into recession.

Call for Cobham

intervention

Sterling pounded

on No Deal fears

when it fell into administration,

and just weeks later forked out

£8m for collapsed bicycle chain

Evans Cycles. In January, Ash-

ley bagged online furniture firm

Sofa.com in a cut price deal

after it went bust.

He declared that he wanted to

transform House of Fraser into

the ‘Harrods of the High Street’

and make Sports Direct the

‘Selfridges of Sport’.

But Ashley’s grand ambitions

have been soured by his own

admissions that House of Fra-

ser is in terminal decline, while

comparing the department

store to a ‘broken down car’.

Meanwhile, Sports Direct’s

core business is struggling with

sales falling by 2.9pc over the

past year.

James Yacoub, retail analyst

at Global Data, said: ‘Mike Ash-

ley is clearly too focused on his

quest to become the king of the

High Street by snapping up

multiple retailers, and has

lost sight of Sports Direct’s

existing operations.’

Ashley’s unorthodox approach

to running a business has always

raised eyebrows, but his market

trader style and straightforward

manner has seen him win the

support of large chunks of the

City. Retail analyst Richard

Hyman said: ‘The City was really

keen to jump on his bandwagon

when he floated the business

and it’s not like he tries to pre-

tend that he’s the great expo-

nent of corporate governance.’

In recent years he has dedi-

cated large swathes of time to

orchestrating boardroom bust-

ups at businesses such as

Debenhams, Findel and Goals

Soccer Centre.

And he has also lost a string of

top executives in recent years.

Chief executive Dave Forsey,

chairman Keith Hellawell, sen-

ior non-executive

Simon Bentley

and acting finance

chief Matt Pearson

have all quit in recent

years. Head of retail

and Ashley’s key lieu-

tenant Karen Byers

stepped down after 28

years earlier this month,

with another key ally, com-

pany secretary Cameron

Olsen, leaving just days later.

And buried among a 7,000-

word tirade among Sports

Direct’s accounts on Friday,

Ashley revealed finance boss

Jon Kempster had resigned.

Ashley has handed over huge

responsibility to his future son-

in-law, Michael Murray, 29, who

has been tasked with improving

the brand’s image.

Friday’s fiasco could be the

final nail in the coffin for Ashley

as investors appear to be run-

ning out of patience.

Jonathan Pritchard, analyst at

Peel Hunt, said: ‘Friday’s delays

and general nonsense weren’t

“Just Mike” or maverick or slap-

stick, they were an exasperating

and rude means of avoiding

wide analytical questioning

on the very disappointing full-

year results.

‘Sports Direct now seems to

be strategically snookered,

check-mated and clean bowled.

‘The shares are hard to value,

but are surely only for the very

brave.’

Agent Provocateur

Evans Cycles

Flannels

House of Fraser

Newcastle United

Sofa.com

Game Digital

Sports Direct

Findel

French Connection

Goals Soccer Centres

Iconix Brand Group

100pc

100pc

100pc

100pc

100pc

100pc

85.7pc

62pc

36.9pc

27pc

18.9pc

8.9pc

TYCOON’S EMPIRE

or in this company.’ While

s Direct’s value has been

elled, Ashley has been on a

g spree.

as made a name for himself

ng up troubled firms such as

of Fraser, which he bought

en it fell into administration,

d just weeks later forked out

m for collapsed bicycle chain

ans Cycles In January Ash-

ior

Sim

and

chi

hav

yea

and

ten

ste

years earlier this month,

with another key ally com-

Agent Provocateur

Evans Cycles

Flannels

House of Fraser

Newcastle United

100 pc

100 pc

100 pc

10 0pc

100 pc

TYCOON’S EMPIRE

non-executive

mon Bentley

d acting finance

ef Matt Pearson

ve all quit in recent

ars. Head of retail

d Ashley’s key lieu-

nant Karen Byers

epped down after 28

ars earlier this month

214.8p

Share price

last night

922p

Sports Direct’s

peak in 2014

MIKE Ashley wanted to be the

saviour of the High Street.

But the troubled retail mogul’s

dream of returning a host of strug-

gling chains such as House of Fraser

to their former glories is turning into

a nightmare.

And in a further blow to the abrasive

tycoon, shares in Sports Direct fell by as

much as 20pc in early trading yesterday

before recovering to close down 6.5pc, or

15p, at 214.8p.

The stock has lost 77pc of its value

since peaking at 922p five years ago.

Shares are 28pc lower than when Sports

Direct listed on the stock market at 300p

in February 2007.

With a value of just £1.1bn, Sports

Direct is worth just a fraction of arch

rival JD Sports, which carries a £6.2bn

price tag.

And Ashley’s personal fortune has suf-

fered as a result.

More than £2.3bn has been wiped off

his holding in Sports Direct since shares

hit record highs in 2014, leaving him with

a stake worth around £709m.

The latest slide in the share price came

after Ashley published Sports Direct’s

latest results more than ten hours later

than planned on Friday, having already

delayed their publication a week earlier.

The delays had investors worried – and

rightly so. The update included an unex-

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