Pay my brother £11m, Ashley tells Sports Direct board
MIKE Ashley has told Sports Direct board members to pay £11m he believes is owed to his brother.
Ashley claims his older brother John has been underpaid millions for work he did while employed as the firm’s head of IT. John worked for Sports Direct from 1989 until 2015.
The 53-year-old billionaire has called on investors to vote through the deal – even though he believes they will object to it.
However, the payment of such a vast sum has caused unease in the City, particularly as Ashley has long been accused of nepotism. As well as hiring John, his son-in-law has worked for Sports Direct, and the store stocks daughter Matilda’s line of beauty products.
Paul Lee, head of corporate governance at Aberdeen Asset Management, said: ‘It’s fundamentally difficult for us to see how it’s in clients’ best interest to support the resolution to pay money for services that have already been completed, jumping backwards in that way doesn’t really work. It would be surprising if many independent shareholders felt it appropriate to support the resolution.’
Investor group Pirc also said it was minded to oppose the payment unless Sports Direct could persuade it that it added value to the company’s long-term strategy. Mike Ashley, who is worth around £2.16bn and lives with his ex-wife Linda, said he was preparing for a backlash from investors.
He said: ‘I fully expect that independent shareholders will vote against this proposal due to the passage of time involved, although in my opinion, technically the money is owed.
‘It’s important for me to say that if John had owed one pound to Sports Direct, I would have ensured any sum was repaid in full.’
John Ashley joined the firm in 1989 and headed up Sports Direct’s IT department until 2015. He has since re- joined Sports Direct to work on IT.
The discrepancy in the accounts came about after accountants were asked to look into how fairly John Ashley was paid after the company floated on the London Stock Exchange in 2007.
It is claimed Ashley didn’t pay John a bonus because of fears of a backlash from the press.
As part of the original flotation agreement, each key senior management team would receive the same bonus and pay while employed by Sports Direct.
John Ashley received an annual £ 150,000 salary after Sports Direct listed and a cash payment of £706,502 under the company’s employee bonus scheme in 2009. When he left the firm, John founded Barlin Delivery, which won a contract to deliver international goods for Sports Direct. After it was revealed the firm didn’t have any vans, Sports Direct severed ties with Barlin.
Mike Ashley told shareholders: ‘I always put the interests of Sports Direct ahead of my own. I want you to know that I will continue to put Sports Direct first as we move forward together.’ Last month it emerged he had put Newcastle United up for sale. Businesswoman and former girlfriend of Prince Andrew Amanda Staveley made a £300m bid for the club earlier this week which was rejected by Ashley.