Sports Direct has taken an 11% stake in struggling fashion retailer French Connection.
The Mike Ashley-controlled retailer has emerged as the mystery buyer of the stake previously held by French Connection’s second biggest shareholder Schroders.
Ashley has repeatedly said he wants to make Sports Direct the “Selfridges of Sport” as part of a bid to take his business upmarket.
So a bit of French Connection bought by Sports Direct. Wonder if this means it'll end up in the basement of Sports Directs, like Firetrap?— john ryan (@newstores) February 2, 2017
French Connection’s founder Stephen Marks has been under fire of late, with a trio of activist investors calling for a shake-up of corporate governance at the loss-making business.
Investors Gatemore, OTK Holding and Zoar Invest together own 15% of French Connection.
They want board members Claire Kent and Dean Murray to step down from their posts and say that Marks – who owns 41% of the business – should split his roles as chairman and chief executive.
In a victory for the investors, Marks last week signalled that Murray and Kent, who have been on the board since 2008 are on the verge of losing their status as independent directors as defined by the UK Corporate Governance Code, were to be replaced.
Sports Direct also holds stakes in both Findel and Debenhams while Ashley has invested in online business My Sale.