RETAILER Sports Direct is trying to win a disputed 29 per cent stake in Blacks Leisure and potentially use its muscle to oppose its troubled rival’s rescue plans.
Sports Direct’s subsidiary Sportsdirect.com is looking to acquire the shares as well as an 11 per cent holding in JD Sports Fashion from the administrators of collapsed bank Kaupthing Singer & Friedlander.
The move would allow the FTSE 250 group controlled by billionaire Newcastle United owner Mike Ashley to vote against Blacks’ fundraising plans at the group’s annual meeting tomorrow.
“If such rights in the shares are acquired, Sportsdirect.com currently intends to vote against the resolutions proposed by Blacks, which also owns the Milletts brand, at its general meeting convened for 24 February, however this remains subject to review and final determination by the board of directors of Sportsdirect.com prior to that general meeting being held,” Sports Direct said in a statement.
Blacks is looking to raise £22m through a share placing and open offer and use the proceeds to speed up its recovery plan and open 35 new stores.
Administrators Ernst & Young took control of the two stakes last October after their acquisition was part-financed by the collapsed bank.
This set off a legal battle as to who owned the shares.
Last February Sports Direct launched a takeover bid for Blacks without disclosing it had lost its 29.9 per cent stake in the retailer.
Blacks retaliated by reporting Sports Direct to the City watchdog for allegedly breaking City rules.
SINGER CAPITAL MARKETS
Blacks Leisure’s advisers at Singer Capital Markets were working tirelessly yesterday trying to ensure the group’s emergency fundraising, a £22m share placing and open offer, does not get voted down.
The Singer team on the Blacks transaction is led by Jeff Keating and former UBS man Jos Trusted.
Trusted said last night: “We’re working hard to try to get a solution. We’ve been asking Sports Direct to clarify their intentions and they don’t necessarily have a negative stance.”
Curiously Singer also lists Mike Ashley’s Sports Direct as a corporate client, although Trusted says “there’s no question of who we’re working for in this transaction and that’s Blacks.”
Singer has built up a strong reputation in the retail sector and was engaged to be working on the IPO of New Look prior to it being recently called off. It also employed one of the sector’s most highly respected research analysts, Matthew McEachran.
Keating and Trusted were both part of the management team that bought the firm out when it became a casualty of the Icelandic banking crisis.
The firm’s clients include Accident Exchange, Entertainment One, Eurovetech, and bull semen firm Genus.