Sports Direct buys loss-making Flannels for 'a nominal sum'

Mike Ashley's Sports Direct has agreed to buy a controlling stake in the Manchester-based fashion chain Flannels.

Flannels, which sells designer brands including Dolce & Gabbana, Paul Smith and Burberry, has nine shops in Manchester, Leeds, Liverpool and Birmingham. Last year it entered a company voluntary arrangement (CVA) and restructured the business, closing some of its shops.

It is thought Sports Direct is paying a nominal sum as the company is still loss-making. Flannels, which was founded in 1976 by Neil Prosser in Knutsford, Cheshire, completed its CVA last month. Its most recent accounts show that the business made a £310,450 loss last year. Mr Prosser is thought to be staying with the chain.

Sports Direct has been expanding into the world of men's fashion. Last year it bought Sir Tom Hunter's USC and Cruise clothing chains.

Rival sports group JD Sports has also upped its fashion credentials. Last year it bought Cecil Gee from Moss Bros, and has teamed up with the fashion marketing agency Four Marketing Group.