NEWCASTLE United owner Mike Ashley’s sportswear empire has snapped up almost five per cent of shares in department store Debenhams.
Sports Direct International said the stock market purchase – worth about £46m – would allow the companies to consider ways to work together.
Debenhams, which has a store in Waterloo Square, South Shields, and issued a profits warning on New Year’s Eve after poor Christmas trading, said it was open-minded about the offer of exploring operational opportunities in order to improve its performance.
As well as 409 stores in the UK, Sports Direct has a portfolio of 28 internationally-recognised sports, fashion and lifestyle brands including Dunlop, Slazenger, Everlast, Lonsdale and Karrimor.
Mr Ashley set up the business after leaving school in 1982 and was the sole owner until a stock market listing in March 2007, which netted him £929m.
The company, which has purchased 56.8 million shares in Debenhams, has a history of buying strategic stakes in other retailers, most recently JJB Sports.
The firm said: “This acquisition of shares has taken place without the prior knowledge of the Debenhams board of directors, but Sports Direct has communicated to Debenhams’ board its desire to work together and its intention to be a supportive shareholder.”
Debenhams has 240 stores in 29 countries – 150 in the UK – and has a top five market share in womenswear and menswear and a top 10 share in the market for childrenswear.
The company said: “Debenhams notes that Sports Direct intends to be a supportive shareholder and that it wishes to explore options at an operational level to work together.
“Debenhams is open-minded with regard to exploring operational opportunities to improve its performance.”