Mike Ashley’s Frasers Group is seeking approval for the billionaire entrepreneur to cash in £585m of shares which could be bought back by the company in a private deal.
Under the plan, the stock market-listed retail group said it wanted permission from shareholders to buy back the shares privately from Ashley – in one or several transactions – at the market price at the time.
Frasers, which owns retailers and brands including House of Fraser, Sports Direct and Flannels, said its directors “will only exercise the power to conduct off-market purchases if they conclude at the relevant time it is in the best interests of the company and its shareholders as a whole”.
Ashley, the founder of Frasers Group’s core Sports Direct chain and former Newcastle United owner, is the retail group’s largest shareholder, currently holding a 73% stake.
Although he could sell a 15% stake in the company, the proposed buyback scheme would result in the cancellation of 67.5m shares. That move would lead to a fall in the number of shares in issue meaning that, if all are bought privately by Frasers, Ashley would not only receive a cash payout but his stake would only reduce to 68%.
In the statement to the stock market, Frasers said: “The directors will only exercise the power to conduct off-market purchases if they conclude at the relevant time it is in the best interests of the company and its shareholders as a whole.”
The statement was released late on Friday ahead of the bank holiday as a resolution to be voted on at next month’s annual shareholder meeting at its headquarters in Shirebrook in Derbyshire. In it, Frasers’ directors said the private sales could be made in conjunction with sales to institutions.
The share buyback plan is the latest in a long list of unusual moves by Ashley since Frasers listed on the stock market.
Frasers is run by Michael Murray, the husband of Ashley’s elder daughter. The boyfriend of his youngest daughter, David Al-Mudallal, was this year appointed to the board, making the 31-year-old one of the youngest directors of a FTSE 100 company.
On Friday, it emerged that Ashley had appointed his 27-year-old daughter, Matilda, as a director of Mash Holdings, the company through which he controls his stake in Frasers.
Ashley stepped down from the Frasers board in 2022 but still owns the majority of the shares and holds a wide-reaching consultancy role.
The group now owns more than 1,500 stores across 20 countries. It controls a string of high street chains including Evans Cycles and Jack Wills. It also owns large stakes in listed retailers including Boohoo.com, Asos and Curry’s, as well as luxury brands Hugo Boss and Mulberry.
