Entrepeneur linked to Blacks move

By THIS IS MONEY
Updated:

 

STRUGGLING outdoor clothing specialist Blacks Leisure was today said to be a bid target for Sports World entrepreneur Mike Ashley.

The Times said Mr Ashley - who also owns the Karrimor backpack brand and Piccadilly sports shop Lillywhites - was thought to be behind an 11.2% stake in Blacks declared by Man Financial yesterday.

The investment and rumours of a possible takeover bid sent shares in Blacks up 6% - just a day after they plummeted 18% following the firm's second profits warning in six weeks on Wednesday.

Blacks, which is valued at £165.6m, warned that it was only likely to break-even in the first half of the year after sales of camping kit at its Millets chain fell 5.6%.

The reports of interest from Mr Ashley came as Blacks unveiled a five-year licensing agreement with Australian firm Gazal to manage four Mambo stores in the UK and growth of the surfwear brand in Europe. Blacks also said it had entered a partnership with Evans Cycles.

The company blamed the World Cup and the lack of a Glastonbury Festival for the poor sales of camping kit at Millets. Millets has also faced stiff competition from the large supermarkets with Tesco and Asda selling two-man tents for less than £10.

Blacks fared better at its Blacks Outdoor stores and Freespirit and O'Neill outlets but the declining sales at Millets meant it expected to break even in the first six months of this year having made profits of £6.9m in the same period last year.

Investec Securities analyst Mark Charnock said that although the figures were disappointing, the 18% fall in share price on Wednesday could spark takeover interest.

Mr Ashley is ranked 54th in the Sunday Times Rich List with an estimated fortune of £1 bn. It is thought that he built up a 10% stake in JJB through Man Financial last month while he has a shareholding of more than 20% in JD Sports owner John David Group.

Mr Ashley also owns the Lonsdale boxing brand and tennis racket maker Dunlop Slazenger.

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