Sports Direct owner Mike Ashley tightens hold on Hugo Boss

Frasers Group increases stake in German fashion house to 48%, after buying Harvey Nichols chain last week

The retail billionaire Mike Ashley has given the latest indication that his summer shopping spree may be far from over, after he increased his stake in the luxury giant Hugo Boss to nearly half. Ashley’s Frasers Group, which last week bought Harvey Nichols department stores for a reported £40m, increased its shareholding in the German fashion house to 48%, falling short of taking full control. In June, the British billionaire made a nearly €2bn (£1.73bn) takeover offer for the luxury group, but its board rejected Frasers’ bid as “inadequate” and urged shareholders not to accept Ashley’s offer.

The new, higher stake is a result of 17.6% of shareholders accepting Ashley’s offer, which amounted to €38 a share. That bid reflected only a 4% premium to Hugo Boss’s shares when it was tabled. Axel Rudolph, an analyst at the investing platform IG, said it was “another major step towards gaining control” of Hugo Boss. Ashley’s new shareholding puts Frasers “firmly in the driving seat as it looks to increase its influence”, he added.

Frasers, which has stocked Hugo Boss products in its stores for some years, has taken an increasingly activist role since it first took a stake in the German group in June 2020 by pushing for change at the company, which has faced struggling sales in women’s clothing and sluggish demand in its important Chinese market.

The Hugo Boss chair, Stephan Sturm, said on Tuesday: “We appreciate Frasers Group’s continued long-term commitment to Hugo Boss and look forward to maintaining a constructive relationship with them as our single largest shareholder.”

Ashley has been building his interests in luxury fashion in recent years with the Flannels chain and a large stake in the British handbag maker Mulberry. He bought Harvey Nichols out of administration last week after the upmarket chain, which has 13 stores and 1,200 employees, warned it could run out of money if it did not find new funding.

If he does succeed in taking eventual control of Hugo Boss, it would add another brand to the group that already owns the Frasers department stores, formerly House of Fraser, as well as Sports Direct and the bicycle retailer Evans Cycles.

Ashley, who is known for his controversial business tactics , retains a 73% stake in Frasers, which he built from a single sports store in Maidenhead, Berkshire, opened in 1982 with £10,000 from his parents. He stepped down from the board in 2022.

His wealth grew by £317m to £3.44bn last year, according to the Sunday Times rich list.

The retail analyst Nick Bubb wrote on Tuesday that the Hugo Boss bid was “surprisingly successful, getting up to nearly 48% ownership of the business, despite the apparently token nature of its €38 offer”.

Ashley also launched a bid to snap up the Australian footwear business Accent Group earlier this summer.