Jenners owner Mike Ashley launches £60m shares spending spree despite coronavirus woes
Mike Ashley’s Frasers Group has revealed plans to spend £60 million between now and and July – despite warning less than a month ago that it would suffer a £200 million hit from Covid-19-induced store closures.
It comes just days after the billionaire businessman was told by Edinburgh City Council to reinstate the signs on the historic Jenners building in the city centre.
The company, which includes House of Fraser, Sports Direct, Evans Cycles and Jack Wills, as well as the Jenners brand, will start the buying spree on Tuesday – buying a maximum 10 million shares.
No reason was give for the decision but businesses typically purchase shares and hold them in reserve to reduce the number of shares available to the public, which tends to push up the share price.
Frasers said: “The purpose of the programme is to reduce the share capital of the company.”
The company has been critical of the Government’s response to extending the business rates holiday, complaining that the support on offer did not go far enough for big chain retailers.
Despite bemoaning the financial woes for the business, it has also made several unsuccessful attempts to buy up rivals who have struggled during the pandemic, including Arcadia, Debenhams and Peacocks.
Frasers reopened its estate on April 12 following the easing of lockdown restrictions for non-essential retailers. It did not give an update on current trading.
During the first lockdown in March 2020, Mr Ashley tried to claim that Sports Direct was an essential retailer and should remain open, but faced a severe backlash from unions and politicians – including the Prime Minister.
Last week, pictures showed the iconic gold-lettering from the Jenners building’s entrance on South St David Street in Edinburgh stashed away in a cupboard after it was removed.
A probe was launched in what new owner – Danish retail clothing billionaire Anders Povlsen – described as a “shock” and a “surprising” moment.
Following an investigation, council officials issued a listed building enforcement notice to owner, Mr Povlsen, and tenant Mr Ashley requiring for the iconic signs to be reinstated.
Mr Ashley has three months to comply when the notice comes into effect on May 14.