United boss told to brush up act
Oct 29 2007 by Iain Laing, The Journal
NEWCASTLE United owner Mike Ashley is understood to have been told to “get his house in order” by the new non-executive directors of his sportswear retail company Sports Direct.
The reprimand follows the last week’s decision to quit by Chris Bulmer, another non-executive of the Sports World parent company, citing lack of corporate governance at the business, which floated in February, netting Ashley £929m.
Mr Bulmer was replaced by Malcolm Dalgleish, head of retail in Europe at property company CB Richard Ellis, and Dave Singleton, former executive at sports brand Reebok.
Dalgleish and Singleton are said to have given Mr Ashley an ultimatum, saying that they would only join Sports Direct if he sorted out a number of coporate governance and personnel issues.
“They made it quite clear that he had to get his house in order over corporate governance,” said a source. “They were referring to everything from the way the company acts [towards the City] to the financial information that comes out.”
They are said to be worried about the lack of people in the financial department who have experience working for a public company.
Sports Direct has had no shortage of deals, including buying boxing equipment maker Everlast and Finnish sports firm Amer Sports. But its trail of acquisitions since February flotation has failed to win over investors, who have seen the value of their shares fall by more than half in the last seven months.It floated at 300p a share but closed on Friday at 143p.
Mr Ashley, who founded Sports World in 1982, has labelled some of his critics in the Square Mile “cry babies”, but the company struggled to adapt to life as a publicly-listed business and has been accused of poor communications and vague trading updates.
The company is also without a chairman following the resignation in May of David Richardson, who departed saying he was “unable to establish a strong working relationship” with the executive team. Sports Direct said last week’s appointments were part of its “ongoing commitment to review board membership.”
