Mike Ashley’s Frasers ups stake in home shopping giant
Frasers Group has increased its stake in N Brown, the Manchester-headquartered online shopping business to 17.8%.
The owner of Sports Direct, now run by founder Mike Ashley’s son-in-law Michael Murray, first swooped for a shareholding in September 2022, fuelling market speculation then as to his intentions, raising the stake to just over 5% by October.
The deal comes after shares in N Brown, which owns Simply Be, JD Williams and Jacamo, dipped last month after it warned investors that the cost-of-living crisis would impact sales.
Frasers has recently acquired Missguided, Studio Retail Group, and I Saw It First, and in a surprise deal bought 15 retail brands from JD including Tessuti, Pretty Green and Scotts in a £47.5m cash deal.
Danni Hewson, financial analyst at AJ Bell said: “The one thing Mike Ashley always understood is the importance of scale. Buy in bulk and sell off cheap was the hallmark of his Sports Direct business and Frasers Group has learnt lessons from that mantra. Online retail has been struggling to find its way in an era of high inflation and post-Covid retail trends. The cost of doing business has become impossibly expensive for some companies and the cost-of-living crisis is likely to continue to dampen sales over the next year.
“Adding an additional stake in N Brown to Frasers’ portfolio will raise speculation that with a few more rolls of the dice it could be added to the roster of brands on the Frasers Monopoly board. Pooling resources, talent and costs make smart business sense at the best of times, at the worst of times they’re crucial. Frasers appears to have a long shopping list and seemingly bottomless pockets that have helped it pick up retail casualty after retail casualty, N Brown could be the next.”