– Building the billionaire’s empire continues
– Frasers becomes the fourth largest shareholder of ASOS
– Hugo Boss participation has increased
Retail conglomerate controlled by Mike Ashley phrases (FRAS) has become the fourth largest shareholder in the struggling online fast fashion seller ASOS (ASC) and increased its investment in Hugo Boss (BOSS: ETR)moves that show that retail kingpin Ashley is not done with the sector yet.
Shares in sportswear-to-luxury brand supplier Frasers, which has sucked in a slew of UK retailers in recent years, firmed 0.6% to 625 pence on share-gain news.
WHY HAS ASHLEY BEEN INTERESTED IN ASOS?
Sports Direct-to-House of Fraser, owner of Fraser, has emerged as a 5.1% shareholder in ASOS just days after José Antonio Ramos Calamonte, the new CEO of the troubled online fashion retailer border its recovery plan as ASOS reported a slowdown in sales and a jolt towards full-year pre-tax losses.
Frasers’ stake in Topshop owner ASOS, whose shares rose 1.8% to 519 pence on the news, will not give him any control over the business or a board seat, although Frasers could consider using his stake to create a society. with the fallen online fashion provider.
As AJ Bell financial analyst Danni Hewson noted: ‘ASOS’ financial results revealed some major problems for the company, as its core demographic dries up spending and the company faces rising costs and a more perilous balance sheet position. , but Ashley clearly believes there is still value in the brand.’
HOW MUCH OF HUGO BOSS DOES FRASERS HAVE?
phrases he now owns 4.3% of the shares of German fashion brand Hugo Boss directly and owns an additional 28.5% through financial instruments known as put options, giving him a 32.8% stake in the seller of clothes, watches and glasses worth almost 1,000 million euros without having to make a takeover bid.
“Frasers Group has a long history (over twenty years) of making strategic investments to develop relationships and partnerships with other retailers, suppliers and brands, including through stock purchases, options, contracts for difference and other financial instruments,” he explained. the company based in Shirebrook.
“The strategic investments Frasers makes offer new opportunities for the company, while helping to support the long-term future of existing retail businesses and the many thousands of jobs they support.”
Furthermore, Frasers explained that he has “broad ambitions” to grow the business in and outside the UK and is “constantly exploring the potential for further expansion”.
Ashley recently stepped down as CEO of Frasers and handed over to his son-in-law Michael Murray, though he remains the majority shareholder in a conglomerate that owns everything from Sports Direct and House of Fraser to Flannels, Jack Wills, Game, Evans Cycles. , Missguided and Studio Retail.
Frasers also has holdings in Blackberry (MUL: TARGET) Y N Brown (BWNG:TARGET) and is seeking full ownership of the Australian online retailer MySale (MYSL: TARGET).
DISCLAIMER: The AJ Bell financial services company referenced in this article owns Shares magazine. The author of this article (James Crux) and the publisher (Ian Conway) own shares of AJ Bell.
LEARN MORE ABOUT FRASER
Issue date: October 24, 2022