Mike Ashley in £60m shares spree

MIKE Ashley’s Frasers Group has announced plans to spend £60m between now and July despite warning less than a month ago that it would suffer a £200m hit from the Covid-19 pandemic.

The company, which includes House of Fraser, Sports Direct, Evans Cycles and Jack Wills among others, will start the buying spree this week – buying a maximum 10 million shares.

No reason was give for the decision but businesses typically purchase shares and hold them in reserve to reduce the number of shares available to the public, which tends to push up the share price.

Frasers said: “The purpose of the programme is to reduce the share capital of the company.”

The move comes less than a month after bosses said the retailer could take a hit in excess of £200m.

At the time, they added that further restrictions are “almost certain”, believing a writedown against freehold values and other noncash impairments will be required.

The company has also been critical of the Government’s response to extending the business rates holiday, complaining that the support on offer did not go far enough for big chain retailers.

Despite bemoaning the financial woes for the business, it has also made several unsuccessful attempts to buy up rivals which have struggled during the pandemic, including Arcadia, Debenhams and Peacocks.

Frasers reopened its estate on April 12 following the easing of lockdown restrictions for nonessential retailers. It did not give an update on current trading.