(Bloomberg) -- Billionaire Mike Ashley’s Frasers Group Plc has raised its investment in Hugo Boss AG as the U.K. retailer pursues a strategy of taking bets on rival operators and “elevating” its own brands.
The company behind Sports Direct, Flannels and House of Fraser disclosed on Tuesday that it now controls a 15.2% “strategic position” in the German luxury fashion brand through a combination of stocks, contracts for differences and put options. The increased investment reflects its belief in Hugo Boss’s long-term future and that it intends to be a “supportive stakeholder,” Frasers said.
The holding in Hugo Boss is the latest in a series of big investments that Ashley has made in retailers across Europe and the U.S. Frasers currently has positions in companies including Mulberry Group Plc, Studio Retail Group Plc and French Connection Group Plc.
Hugo Boss climbed as much as 8.6% in Frankfurt trading, the most since Nov. 9. It was up 4.9% at 11:54 a.m., valuing the company at about 2 billion euros ($2.4 billion).
Frasers has never explained in detail why it invests in competitors. Analysts have speculated that it’s part of an “elevation strategy” designed to make the company’s brands more upmarket.
Holding significant positions in glossy fashion houses, such as Hugo Boss or Mulberry, can help cement their supplier relationships with Frasers’ brands -- particularly its Flannels and House of Fraser luxury department stores. In the past, Ashley has complained about its Sports Direct brand being frozen out of the supply of the best products from Nike and Adidas.
A previous investment in Games Digital, the U.K. gaming retailer, ultimately led to a takeover of the group by Frasers Group. Its investment in Finnish Line paid off when the U.S. retailer was subsequently bought by JD Sports Fashion Plc.
Not all of the investments have been successful. Sports Direct lost 150 million pounds ($205 million) investing in Debenhams, the failed U.K. department store. Despite the setback, Frasers is one of the parties still locked in talks to rescue part of the Debenhams business which is now in U.K. insolvency proceedings.
Ashley, a former squash coach, owes his fortune to Sports Direct, which he founded in 1982, having opened his first shop in Maidenhead the previous year. The business has dramatically expanded since then had annual revenue of almost 4 billion pounds in fiscal 2020.
Últimas Noticias
Debanhi Escobar: they secured the motel where she was found lifeless in a cistern
Members of the Specialized Prosecutor's Office in Nuevo León secured the Nueva Castilla Motel as part of the investigations into the case
The oldest person in the world died at the age of 119
Kane Tanaka lived in Japan. She was born six months earlier than George Orwell, the same year that the Wright brothers first flew, and Marie Curie became the first woman to win a Nobel Prize
Macabre find in CDMX: they left a body bagged and tied in a taxi
The body was left in the back seats of the car. It was covered with black bags and tied with industrial tape
The eagles of America will face Manchester City in a duel of legends. Here are the details
The top Mexican football champion will play a match with Pep Guardiola's squad in the Lone Star Cup
Why is it good to bring dogs out to know the world when they are puppies
A so-called protection against the spread of diseases threatens the integral development of dogs
