Sports Direct has split from three of its brokers, announcing today that Liberum Capital would be its sole broker from hereon.
The controversial retailer's former collection of brokers was made up of City heavyweights Goldman Sachs, Citi and Haitong.
Haitong and Citi are both neutral on the company's shares, while, last May, Goldman Sachs stopped recommending investors snap up shares and then later slashed its full-year profit forecasts. By contrast, Liberum is one of the few brokers with a “buy” recommendation for the retailer.
"Following a...fall in the shares in the past six months we do not see the lack of acquisitions as an obstacle to earnings growth nor does the rating require earnings-enhancing M&A," Liberum analysts wrote in a note upgrading their rating from "hold" to "buy" last March. "The strong balance sheet and around £200m of free cash flow per annum could be deployed in other ways."
Shares in the retailer have plummeted over the last year, and are currently trading at around a third lower. The company's tumbling share price lead it to being kicked out of the FTSE 100 last March.
Meanwhile, the Telegraph reported that Sports Direct founder, majority shareholder and chief executive Mike Ashley was understood to be close to Michael Sherwood, Goldman Sachs' European boss who announced he was leaving the bank last November.
Both Sherwood and Ashley were grilled by MPs last year, the former over his involvement with collapsed retailer BHS and the latter over corporate governance issues at his own company.
A scathing report published by the Business, Innovation and Skills Select Committee last July slammed the "extremely disturbing" working conditions at the company, likening its Shirebrook warehouse to "a Victorian workhouse".
The Derbyshire-headquartered company has been leaning back from dealmaking as of late, instead looking to slim down its brand portfolio.
The firm, which currently owns 17 sports brands and 11 fashion and lifestyle brands, ditched Dunlop for £122m last year. It has been reported that tennis brand Donnay and boxing brands Lonsdale and Everlast could all be up for the chop later this year.
Sports Direct has not responded to City A.M.'s request for comment at time of writing.