Two of retail’s most high-profile companies have become unlikely bedfellows.

The 1 per cent stake may be small, but the repercussions are unlikely to remain so and Baugur’s elusive founder Jón sgeir Jóhannesson and Sports Direct’s mercurial Mike Ashley could prove a volatile combination.

Despite reports in The Daily Telegraph today that Baugur is merely taking a “punt” on Sports Direct – at a time when its share price is half its flotation price of 300p – Baugur's investment history signals that it rarely remains a purely passive investor.

In June, Baugur began a measured stake-building offensive in City whipping boy Debenhams, although Jóhannesson was later ruled out of making a bid for six months, after loose-lipped comments about the opportunities Baugur saw in the retailer.

At the time, Jóhannesson’s right-hand man Gunnar Sigurdsson told Retail Week that investing in shares at a low value is “a good move”, but what that means long term remains “open and flexible”, it said.

After building a 9.5 per cent stake in House of Fraser last year, it converted it into full-scale bid for the retailer.

And with the investment firm expected to imminently launch its first full-scale assault on the US, its recent acquisition of an 8 per cent stake in US retailer Saks looks less than insignificant.

Similarly, Mike Ashley has provided plenty of newspaper fodder with his combative stance on the City – or the “cry-babies” as he once so eloquently put it – and his secretive hunter-gathering tactics.

Since July, he has been scooping up his shares – 84.5 million to be exact – at an average of 137p a share. He has bought up 12.4 million this week alone.

While he gobbles up shares that continue to languish at depressingly low prices, and as he refuses to clarify his intentions for Sports Direct, a question mark hangs over how long the retailer will remain a listed company.

It seems unlikely that Baugur, which has been willing to be vocal about its stake in another troubled retailer Woolworths, will not have a view on beleagured Sports Direct’s performance. At present, the retailer appears even more rudderless than ever.

Without a permanent chairman and only one non-executive director, there is a sense that the company is about to face a showdown. And undoubtedly Baugur, which relishes the thrill of the chase, will want to be in on it.