Sports Direct’s big split – how long will it last?

It’s the other big split to hit the headlines in recent days, said Nick Fletcher in The Observer. “No, not Brangelina, nor even Mary Berry and Bake Off.” This one involves Sports Direct and Dave Forsey, who quit last week as CEO of Mike Ashley’s retail group following “unrelenting criticism” of working conditions there. The firm’s “unpopular” chairman, Keith Hellawell, still remains in place, and Forsey’s replacement is… Mike Ashley (“who most people assumed ran the business anyway”). And even if the move helps to appease shareholders who wanted Ashley to become more accountable, the company still needs to find a permanent finance director, and more external directors to beef up the board.

When the chief executive of a public company suddenly resigns, investors usually panic, said Adam Gale in Management Today. Yet when Forsey quit, the company’s value jumped by 7%.

Ashley’s assumption of responsibility is a welcome step towards improved corporate governance, which explains the share surge. But no doubt he must have some “conflicting emotions”. On the one hand, his personal paper wealth shot up, but on the other, he’s lost his closest ally. “I feel like I have lost my right arm, but I do hope to have the opportunity to work with Dave again in the future,” he said.

Poor bloke – losing his “right arm” of 32 years, said Alistair Osborne in The Times. “Except, as ever with Sports Direct, maybe things are not quite what they seem. Could Mr Forsey simply be taking one for the team?” Forsey faces court in November on criminal charges of failing to notify the authorities over redundancies at USC, a fashion chain bought by Sports Direct from administrators. It will be useful for Ashley to have some distance from that case. But how long before Forsey is “back as a consultant”?