‘The Daily Telegraph’ reports that Sports Direct has been accused of intimidating the founder of the UK’s second largest golf retail business after the Mike Ashley controlled sportswear company changed the locks on Direct Golf’s offices without warning.
The allegations are part of an extraordinary battle for control of the business between Direct Golf’s founder, John Andrew, and Mr Ashley, one of Britain’s most influential but low-profile entrepreneurs. According to Mr Andrew, Sports Direct bought a stake in the 21-store golfing specialist last year.
In July, Direct Golf reported a 48.5pc slide in pre-tax profits to £329,000 and said that sales had fallen by almost 13pc to £20.8m. After consulting with advisers at restructuring firm Begbies Traynor, Mr Andrew filed a notice of administration in a court in Leeds last Thursday afternoon.
However, he alleges that overnight Sports Direct, of which Mr Ashley is deputy chairman, filed wind-up proceedings to ‘gazump’ Begbies Traynor’s appointment in favour of doing a pre-pack deal with its own firm of administrators.
“We are being intimidated as Sports Direct is trying to take control of the company from under our feet,” he is reported to have said.
Mr Andrew also alleges that Sports Direct also removed him from Direct Golf as a director, without informing him.
Furthermore, the former golf professional claims that while he was consulting with his lawyers in Manchester, Sports Direct had changed the locks on Direct Golf’s head offices in Milnsbridge, Huddersfield forcing 180 staff to leave the premises.
Mr Andrew said that Sports Direct’s actions were unfounded as he personally owned the building rather than Direct Golf.
“We thought that Sports Direct had sent us letters of support but they have done the opposite. The only thing I knew was when I got a phone call saying there were four burly men at my offices changing our locks. Our staff are so upset and ashen-faced.
“The police have been called. Personally I feel a bit scared. We are being intimidated as Sports Direct is trying to take control of the company from under our feet.”
Sports Direct is understood to be hoping to put Direct Golf into a pre-pack administration, according to sources.
“They have played a game of chess with our business,” said Mr Andrew. “I have tried to negotiate with them.”
Mr Andrew added that he had offered to hand Sports Direct a majority stake in the company and £1.8m worth of property assets in return for continued financial support.
In February this year, Mr Andrew, who has run Direct Golf for 23 years, was quoted in Retail Week as saying: “The opportunities with Sports Direct group are endless and being close to such a successful retailer fills me with great excitement”.
Mr Andrew said he would be speaking to his staff today and that he hoped to ‘put their minds at rest’. He said: “Some of these people have been working for me for 10 years and I’m going to invite them to a meeting and send them letters to put their minds at rest. I’m still in negotiations with Sports Direct.”
It was in August that GBN.com reported that Direct Golf has continued its exceptional recent performance by recording increased year-on-year growth for a remarkable 11th consecutive month.
Turnover was up 25 per cent overall for July, with the 21 ‘bricks-and-mortar’ stores up by 34 per cent, while the brand’s ‘online marketplace’ presence saw a massive rise of 47 per cent.
The results maintain the company’s push for a record year with turnover for the year also currently up 25 per cent – despite other retailers in the sector finding trading conditions unfavourable.
Earlier this year the company had opened a new store in Southampton – Direct Golf’s southern-most outlet and part of an expansion plan which will double the number of stores from 20 to 40 by 2018 – with at least one more new outlet scheduled for 2015.
Meanwhile, a substantial investment in refurbishment across the country has seen the introduction of new state-of-the-art apparel and footwear departments plus a ‘brand shop in shop’ experience. And the company has also re-launched its logo as it looks to increase its share of the European market.
Founder Andrew said: “These latest results are continued testament to the strategies and changes we have put in place over the last year or so, and also to the hard work put in by our staff, whether they’re in store or on the end of the phone.
“Other retailers, sadly, appear to be struggling in this sector, but we’ve shown there is hope and business out there if you get your proverbial ducks in order. This is a great year for Direct Golf and long may it continue.”
In July John Andrew, who has become well-known for his use of ‘guerrilla marketing’ tactics made quite an impression in St Andrews by deploying his ‘Direct Golf morphs’.
Direct Golf UK www.direct-golf.co.uk
In each month and year listed below every article that has ever appeared in golfbusinessnews is reproduced in reverse date order.