Retail tycoon Mike Ashley has ramped up bets that the stock price of his UK retail empire will rise, putting up about £196 million ($240 million) worth of shares as security on the gamble.
(Bloomberg) — Retail tycoon Mike Ashley has ramped up bets that the stock price of his UK retail empire will rise, putting up about £196 million ($240 million) worth of shares as security on the gamble.
The former Chief Executive Officer and founder of Frasers Group Plc pledged around 26 million shares, equivalent to roughly 5% of the company, to HSBC as security for derivatives bets he placed, the company said Tuesday.
Recently Ashley sold put options betting that shares in Frasers, which owns the country’s biggest sportswear retailer Sports Direct, will rise above 800 pence by September. That’s on top of previous bets that the stock would rise to 900 pence. The share price is currently 761.5 pence.
Ashley still holds about 70% of Frasers, formerly known as Sports Direct, which also owns stores including Flannels, House of Fraser, Jack Wills and Gieves & Hawkes.
He is no stranger to gambling. In 2017 former banker Jeff Blue sued Ashley, claiming that the businessman agreed to pay him £15 million if he could double Sports Direct’s share price in three years. The deal was sealed during a boozy meeting in a London pub where Ashley allegedly vomited into a fireplace after challenging an analyst to a drinking competition.
Last year Ashley handed the CEO role to his son-in-law Michael Murray and stepped down from the Frasers board. Murray could earn a bonus of £100 million in shares if Frasers’ stock hits £15 a share for 30 consecutive trading days by October 2025.
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