MIKE ASHLEY’s Sports Direct is poised to swoop on Umbro, the football kit maker put up for sale by Nike last week. The discount sportswear chain owned a 30% stake in Umbro, which supplies the England team, before Nike took it private.
The American sportswear giant last week said that it wanted to sell Umbro and Cole Haan, a leather goods company, to focus on its core brand and on faster- growing brands such as Converse.
Nike bought Umbro in 2007 for £285m in an effort to increase its football revenues. However, the Cheadle-based business failed to perform for it. Revenues were $276m in 2006 but $224m (£145m) last year.
In 2009, Nike wrote down the investment by $240m. Mark Parker, Nike’s chief executive, said: “Divesting of Umbro and Cole Haan will allow us to focus our resources on the highest-potential opportunities for Nike Inc to continue to drive sustainable, profitable growth for shareholders.” Revenues were $20.8 billion last year, compared with $16.3 billion in 2007.
There is also expected to be private equity interest in Umbro. A return to the London Stock Exchange, however, is thought highly unlikely given market conditions. Sports Direct declined to comment.