Frasers Group has increased its holding in Currys to 9.4 per cent amid a wave of ‘strategic investments’ made by Mike Ashley’s business empire.
The Sports Direct and Lillywhites owner’s latest transaction comes three days after it declared an 8.9 per cent stake in the white goods seller.
It told investors on Monday that the transaction was ‘a valuable opportunity’ to expand its presence in the electricals sector and enhance the relationship between Currys and Studio Retail.
Building up: Frasers Group has further increased its holding in Currys to 9.4 per cent amid a wave of ‘strategic investments’ by Mike Ashley’s business empire
Alongside this deal, the company has built stakes in struggling online fashion brands Asos and Boohoo of 10 per cent and 5 per cent, respectively.
Both retailers have seen their share prices plummet over the past couple of years as they have grappled with declining revenues and annual losses caused by loosening Covid-related restrictions and cost-of-living pressures.
Frasers also became the second-largest shareholder in AO World following its acquisition of an 18.9 per cent interest in the Bolton-based business as part of a ‘strategic partnership’.
Like Asos and Boohoo, AO World performed well during the lockdown period, when trading curbs created an e-commerce shopping boom, before stumbling after customers returned en masse to bricks-and-mortar stores.
It decided to shut down its German operations due to supply chain issues, marketing costs and hefty market competition, and end an in-store trial with supermarket giant Tesco.
Yet the firm has shown signs of a turnaround, having raised its annual profit outlook four times since July 2022 on the back of management cost cuts and shifting its focus away from unprofitable products.
Frasers Group has an extensive history of investing in distressed businesses, sometimes acquiring them out of administration, such as House of Fraser, womenswear seller Missguided and tailor Gieves & Hawkes.
This has continued ever since Ashley, the former owner of Newcastle United Football Club, was replaced as chief executive in May 2022 by his son-in-law Michael Murray.
Frasers said on Tuesday: ‘We have a clear strategy to identify opportunities to invest in businesses which complement our existing sport, premium and luxury businesses, or help us to build and further utilise our sector-leading ecosystem.’
Frasers Group shares were 0.4 per cent lower at 700p on early Thursday afternoon, meaning their value has slumped by over a quarter from last July.
Under a compensation plan, Murray will receive a £100million bonus should the share price more than double to £15 and remain above that level for 30 consecutive days by 2025.
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