Sports Direct acquires 51% stake in designer fashion retailer Flannels

British sports and leisure clothing and equipment group Sports Direct International Plc (LON:SPD) said it had taken a 51% interest in domestic luxury and designer fashion retailer Flannels Group Ltd, without giving financial details.

The deal will add to Sports Direct’s Cruise and Van Milder businesses within its premium lifestyle division, CEO Dave Forsey said.

The Financial Times cited Forsey as saying that his company viewed the luxury fashion market as a great opportunity. Flannels would also benefit from having a larger player as parent company, Forsey said, adding he could not yet elaborate on how the luxury retailer would change as part of Sports Direct.

Neil Prosser who founded Flannels in 1976, will stay on as managing director and keep the remaining 49% stake in the business. The chain sells designer clothing, shoes and accessories of brands such as Dolce & Gabbana, Lanvin and Moncler. It has six stores in northern England, the Midlands and Wales with locations in Manchester, Leeds, Nottingham, Liverpool, Birmingham and Cardiff.

Sports Direct’s retail group comprises more than 470 stores operating under the names, Sports World, Field & Trek, Hargreaves Sports, Gilesports and Donnay International, as well as shops in Ireland, Belgium, the Netherlands and Slovenia. It sells top brands including Nike, Adidas, Reebok, Umbro and Fila, as well as Everlast, Lonsdale, Dunlop, Slazenger and Karrimor.

Sports Direct moves into fashion, buying USC and Cruise

The sports retail giant has brought an 80% stake in two high street clothing shops, owned by retail tycoon Sir Tom Hunter.

Paying £7million to take control, Sir Tom will retain a mere 20% shareholding, whilst Sports Direct will take control of the stores that specialise in fashion clothing.

With 38 stores in the UK USC had sales of £70m last year, whilst Cruise is a smaller brand with 10 UK stores and an annual turnover of about £20m.

The founder of Sports Direct, Mike Ashley (founder of Newcastle United) will be providing upto £20million to develop both the businesses.

Speaking of the deal, Sir Tom said: “This deal will transform the prospects for both USC and Cruise and our employees at a time of extraordinary turbulence in the High Street,”.

“I’ve known the Sports Direct team for many years and have huge respect for their talent and look forward to co-investing with them.”

Sports Direct chief executive Dave Forsey said: “While USC and Cruise will remain independent of Sports Direct, we will support the businesses with our operational expertise.”

Information has suggested that rival JD Sports was also interested in this deal but lost out.