JD Sports hits back at claims that car park meeting with rival broke watchdog rules
JD Sports has hit back at claims that a car park meeting between boss Peter Cowgill and his counterpart at Footasylum, Barry Bown broke the UK competition watchdog’s rules.
The Sunday Times published a video over the weekend showing Peter Cowgill, JD Sports’ executive chairman and CEO, holding a meeting with Barry Bown in a car park near Bury in Greater Manchester on the morning of July 5, 2021.
In the video, they are initially joined by JD’s general counsel, Siobhan Mawdsley who gets out of the car.
It said Cowgill now “faces questions over his conduct this weekend” as the Competition and Markets Authority is revealed to have launched an investigation into a possible breach of its rules relating to the FTSE 100 giant’s takeover of smaller rival Footasylum.
Responding to the claims, JD Sports this morning said Cowgill has known Bown on a business and personal basis for over 25 years.
“As a result, it is not unusual, or in any way suspicious or illegitimate, for them to meet from time to time, including in relation to the ongoing review by the Competition and Markets Authority (“CMA”) of JD’s acquisition of Footasylum Limited,” it said.
JD said it had an obligation to take “all reasonable steps to encourage key staff of the Footasylum business (which includes Barry Bown) to remain with the business.”
The retail giant said it has already explained to the CMA about the reason and content of the meeting on 5 July and that it “firmly believes” there was no “wrongdoing or any breach.”
It added: “It is disappointing that the Sunday Times has not reported in a more balanced way on the highly irregular and potentially illegal covert surveillance undertaken by a third party for their own interests.
“JD hopes that a regulator, tasked with acting in the wider public interest, is able to more critically regard the actions of the third party for what they are
“Any suggestions with regard to Corporate Governance breaches are totally refuted. JD’s stakeholders are very aware that the Chairman and the Board treat governance matters extremely seriously and with the utmost transparency.”
Last week, the CMA ordered JD Sports to sell Footasylum after an investigation identified pricing concerns between the two retailers.
The watchdog said an investigation found that the £90m takeover could lead to a substantial reduction in competition and a worse deal for Footasylum’s customers.
Its inquiry concluded that JD Sports is too similar to Footasylum.
The CMA said it expects this will continue to be the case even after taking into account the continued growth in online shopping, including on the websites and apps of brands such as Nike and adidas.
The CMA will oversee the sale and approve the purchaser, in order to ensure that Footasylum will be run as a fully independent competitor.
