Mike Ashley set to buy Sofa.com for 'nominal fee' in latest addition to retail empire

Latest in a string of acquisitions comes after swoops for House of Fraser and Evans Cycles

Ben Chapman@b_c_chapman
Friday 01 February 2019 14:46
Sports Direct's Mike Ashley in 60 seconds

Sports Direct billionaire Mike Ashley has agreed to buy Sofa.com for “a nominal sum” ending a battle with ScS Group for the online furniture retailer.

The purchase is the latest in a string of acquisitions by Mr Ashley and comes after swoops for House of Fraser and Evans Cycles to add to his Sports Direct and Flannels shops.

The businessman’s high street empire includes a 30 per cent stake in Debenhams and he has held talks about buying HMV.

He is also rumoured to be eyeing up a bid for Patisserie Valerie, which collapsed this month after uncovering fraud.

ScS confirmed on Tuesday that it was in discussions about buying Sofa.com, one of the UK’s biggest online furniture retailers, but said on Friday that talks had ended.

That left the door open for Mr Ashley to swoop.

He has bought heavily into the high street as it faces some of its toughest ever trading conditions. Close to four in 10 listed retailers issued profit warnings last year, with some doing so on multiple occasions.

Emma Shipp, partner at Hewitsons, said Mr Ashley’s history with House of Fraser and Evans Cycles suggests he will continue to cut staff and close stores across all of his recent purchases.

Ms Shipp added: “Landlords should expect to come under increasing pressure to reduce rent or offer rent-free periods.

“Cross pollination between his businesses is another likely outcome – witness the introduction of Agent Provocateur lingerie at House of Fraser stores last year which are both Ashley owned.

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“For the moment, an overriding strategy in these acquisitions is hard to discern and some have likened it to a ‘Monopoly board’ power grab.”

ScS, which stands for “Sofa Carpet Specialist”, has concessions in House of Fraser stores but announced in October that it would pull out because the partnership was no longer beneficial after Mr Ashley’s takeover of the department store chain.

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