Frasers Group reportedly offers to buy Footasylum
Sports Direct founder Mike Ashley’s retail group is reported to have tabled an offer to buy Footasylum, the trainer retailer that rival JD Sports has been instructed to sell by the competition regulator.
The offer is the latest development in a running battle between Ashley’s Frasers Group and JD Sports over access to the best goods from key suppliers, such as Nike and Adidas, as well as the attention of shoppers.
JD Sports was ordered to sell Footasylum’s 65 stores by the Competition and Markets Authority (CMA) in November, after the watchdog ruled that JD’s purchase of the smaller chain of trainer shops would result in a worse deal for shoppers.
The regulator must approve the new purchaser to ensure it is a truly independent competitor – unless JD Sports successfully appeals against the ruling.
Frasers, which owns the House of Fraser department stores and luxury streetwear retailer Flannels as well as Sports Direct, has notified the CMA of its plan to make an offer, according to a report in the Sunday Times. At the time of the CMA’s decision, JD said the regulator blocking its merger with Footasylum “defies logic”.
Peter Cowgill, the executive chair of JD, has also suggested that the decision was influenced by his key competitor.
Last year, in a veiled reference to Sports Direct, he said: “Incredibly, the CMA has been taken in by the self-serving testimony of one notoriously vocal competitor, who has made numerous public announcements.” He said that competitor had “blatantly participated in the process for their own commercial interests rather than for the benefit of consumers”.
The Bury-based retail group agreed to buy Footasylum in March 2019 for £90m, but the deal has been caught in a tortuous process since then, with the CMA repeatedly trying to block it.
JD declined to comment and Frasers did not respond to a request for comment.