Billionaire Mike Ashley made his money selling cheap footballs and socks — but now he’s getting into the business of selling luxury handbags.
Ashley’s Frasers Group (FRAS.L), formerly known as Sports Direct International, said on Monday evening it had bought a 12.5% stake in Mulberry (MUL.L), the luxury handbag maker. The stake is worth around £18.7m ($24.6m) according to Monday’s closing share price and makes Frasers the third largest investor in Mulberry.
“A key strategic priority for Frasers Group is the elevation of our retail proposition and building stronger relationships with premium third party brands,” Frasers Group said in a brief statement after stock markets closed.
“Frasers Group looks forward to working more closely with Mulberry for the benefit of shareholders of both companies.”
Frasers Group is best known for Sports Direct, the discount sports retailer that made Mike Ashley’s name. In recent years Ashley has sought to move his company upmarket, pledging to turn Sports Direct into the “Selfridges of sport”.
Ashley is also well known for his deal making activity in public markets. Ashley, who owns just over half of Frasers Group, has in recent years bought up a string of struggling retailers, including House of Fraser, Evans Cycles, Game Digital, and Sofa.com.
Ashley has also bought up minority stakes in retailers and taken an activist investor approach, pushing for change. He used the tactic most notably with bust department store Debenhams, which led to acrimonious battles between Ashley and the company’s management.
Luxury group Mulberry was founded in Somerset in 1971 and is best known for its colourful leather handbags. The brand found popularity with fashionistas a decade ago, thanks in part to a tie-up with TV presenter Alexa Chung, but it has struggled in recent years. Shares have slumped 75% since