Mike Ashley’s Frasers Group boosts Currys stake to 9.4%
Frasers Group increases stake in Currys to 9.4% as Mike Ashley’s corporate spending continues
- Frasers Group owns the Sports Direct, Lillywhites and Studio Retail retail brands
- The company has also bought stakes in retailers AO World, ASOS and Boohoo
- Mike Ashley’s retail business is known for buying stakes in distressed companies
Frasers Group has increased its stake in Currys to 9.4 percent amid a wave of “strategic investment” by Mike Ashley’s business empire.
The latest transaction from the Sports Direct and Lillywhites owner comes three days after he announced an 8.9 per cent stake in the white goods retailer.
It told investors on Monday that the transaction was “a valuable opportunity” to expand its presence in the electricity sector and strengthen the relationship between Currys and Studio Retail.
Buildup: Frasers Group has further increased its stake in Currys to 9.4 percent amid wave of ‘strategic investment’ by Mike Ashley’s business empire
In addition to this deal, the company has built stakes in struggling online fashion brands Asos and Boohoo at 10 percent and 5 percent respectively.
Both retailers have seen their stock prices plummet in recent years as they grapple with declining revenues and annual losses due to the easing of Covid-related restrictions and cost-of-living pressures.
Frasers also became AO World’s second-largest shareholder after acquiring an 18.9 percent stake in the Bolton-based company as part of a “strategic partnership.”
Like Asos and Boohoo, AO World performed well during the lockdown period, when trading curbs sparked an e-commerce boom, before stumbling after customers flocked back to brick-and-mortar stores.
It decided to close its German operations due to supply chain issues, marketing costs and fierce market competition, and to end an in-store trial with supermarket giant Tesco.
Still, the company has shown signs of a turnaround, having raised its annual profit forecast four times since July 2022 due to cuts in management costs and shifting focus from unprofitable products.
Frasers Group has a long history of investing in distressed companies, sometimes acquiring them out of administration, such as House of Fraser, women’s clothing retailer Missguided and tailor Gieves & Hawkes.
This has been the case since Ashley, the former owner of Newcastle United Football Club, was replaced as CEO by his son-in-law Michael Murray in May 2022.
Frasers said Tuesday: “We have a clear strategy to identify opportunities to invest in companies that complement our existing sports, premium and luxury businesses, or help us build and further leverage our leading ecosystem.”
Frasers Group Shares were down 0.4 percent at 700p early Thursday afternoon, meaning their value is down more than a quarter from last July.
Under a compensation plan, Murray will receive a £100 million bonus if the share price more than doubles to £15 by 2025 and stays above that level for 30 consecutive days.