Mike Ashley: Sports Direct investors 'have stabbed me in the back'

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Sports Direct billionaire Mike Ashley on Friday claimed he was “stabbed in the back” by shareholders, two days after chairman Keith Hellawell dramatically resigned after a barrage of investor criticism. 

“On the one hand they [shareholders] are delighted with our performance and progress, yet with the other hand they have stabbed Sports Direct and myself in the back by repeatedly hounding Keith Hellawell,” Ashley said. 

In an open letter, the aggrieved retailer triggered speculation he might take the company private because “whatever progress Sports Direct makes, it will always be subject to disproportionate scrutiny and misrepresentation. 

“Despite the substantial progress made over the years, the shareholders have now made it extremely challenging for future engagement to take place,” Ashley said. 

The remarks come after, and partly in response to, the company’s’ annual meeting with investors on Wednesday. Hellawell, formerly Tony Blair’s drug czar who joined the retailer in 2009, resigned before the meeting. He was only narrowly re-elected last year. 

Hellawell and Ashley, who is a 61% shareholder, have repeatedly come under fire over alleged corporate governance failings and concerns about employment practices. They have faced numerous shareholder rebellions over the years.  

At this week’s meeting, outgoing senior independent director Simon Bentley made an off-the-cuff comment, saying the company had considered merging its newly acquired House of Fraser business with Debenhams, in which Sports Direct owns a near-30% shareholding. The Takeover Panel, which oversees takeovers of UK-listed companies, had to step in the same day prompting Sports Direct to issue a formal statement, clarifying it did not plan to make a bid for the struggling department stores chain for at least six months. 

Ashley today insisted his £90 million swoop for HoF will be a game-changer and he welcomed its staff and suppliers into the Sports Direct family. 

However, after he inked the deal the tycoon said he will not be bailing out suppliers, including brands such as Giorgio Armani and Kurt Geiger, which are owed millions of pounds each. 

Sports Direct bought HoF in a controversial “pre-pack deal”, an agreement which allows the buyer to shed its pension scheme and other liabilities.

Source Article from https://www.standard.co.uk/business/mike-ashley-sports-direct-investors-have-stabbed-me-in-the-back-a3936156.html

September 14, 2018 |
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