Author Topic: Tues Aug 11th-Ashley referred to Government Commission over JJB stores deal  (Read 6960 times)

Offline trophy4toon

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Our well dodgy owner has been referred to the Governments Competition Commission by the OFT as Ashley failed to comply to their ruling that he must sell 5 Sports Direct shops he bought from JJB recently.

The OFT have asked the Commission to look at all 31 purchased stores now and he could potentially be made to sell them at a significant loss to what he bought them for.

If Ashley does not sell the club quickly I'm going to have to move this section out of Archive and back into the main area of the Forum again.


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Newcastle boss Mike Ashley faces fair trade probe  By Clinton Manning 8/08/2009

 
Under-FIRE Newcastle United owner Mike Ashley has scored another own goal, prompting competition watchdogs to probe his sports shop empire.

Ashley (right) could be forced to sell more than 30 of his Sports Direct outlets after the Government's Competition Commission said they may be in breach of its rules.

But the larger-than-life billionaire only has himself to blame for the inquiry into the purchase of 31 stores from bitter rival JJB.

Ashley was warned five of these broke competition rules as he already had Sports Direct outlets in those areas.

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The Office of Fair Trading told him to sell them because of the lack of competition and gave him a three-month deadline. Ashley failed to comply and now the OFT has asked the Commission to investigate. But it will look at the 31 stores, not just the five he failed to sell. It could then force him to get rid of them all by the end of the year.

This could trigger a big loss to Ashley as the property market is in a slump . Ashley is already selling Newcastle at a knock-down price. Deal-makers claim the Championship club will be sold by the end of the month once its wage bill is cut.

And he is still reeling from a bitter dispute over a £1million loan to JJB boss Sir David Jones.

A spokesman for JJB said: "These transactions are a done deal. This is now a matter for Sports Direct." But Sports Direct refused to comment on the investigation.
http://www.mirror.co.uk/news/city-news/2009/08/08/newcastle-boss-mike-ashley-faces-fair-trade-probe-115875-21582085/
« Last Edit: August 11, 2009, 12:51:17 am by trophy4toon »

Offline trophy4toon

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And here's Ashley's mate Chris Ronnie (known to the JJB Board as Ashley's stooge) trying to defend his reputation since his sacking by JJB for gross misconduct.

Maybe Ronnie could join Newcastle and be first team manager, at least we'd have a united board then !!

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Chris Ronnie ups the stakes in JJB Sports battle
Chris Ronnie flies easyJet these days. On Thursday the former chief executive of JJB Sports, the embattled retailer, broke off his holiday in Spain to fly to the UK for the day to defend his reputation to this and other newspapers.
 
By James Hall and Richard Fletcher
Published: 9:27PM BST 08 Aug 2009

 Chris Ronnie believes that he has been made a scapegoat and been blamed, unjustly, for JJB's demise Photo: Manchester Evening News
His £240 return flight on the low-cost airline is a world away from the trips Mr Ronnie used to make on JJB's Agusta 109S Grand helicopter, at a cost of around £600 an hour.

But then Mr Ronnie is in a vastly different position now.

 
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JJB refuses to accept resignation of chief executive Chris RonnieThe sportswear executive was fired from JJB in March for "gross misconduct" and without a payoff after it emerged his 27.5pc stake – which he and his Icelandic backer Exista paid £190m for – had been seized by the administrators to the collapsed Icelandic bank, Kaupthing. The man behind the sacking was Sir David Jones, the retailer's chairman and retail legend, who turned fashion chain Next around.

Mr Ronnie wants to put the record straight. Following his dismissal, he believes that he has been made a scapegoat and been blamed, unjustly, for JJB's demise. Sir David has hardly disguised his sour feelings towards Mr Ronnie. In JJB's recent annual report, he wrote that Mr Ronnie's strategy for the chain "affected staff morale and caused confusion". Sir David wrote of "a series of bad business decisions" which rendered the company "dangerously close to insolvency". In the JJB pantomime, Sir David has been portrayed as the swashbuckling hero while hapless Mr Ronnie has been cast as the villain, or worse, Widow Twankey.

The feud is wrapped up in a second saga that has dominated the headlines over recent weeks. In the autumn of 2007, Sir David took a £1.5m personal loan from Mike Ashley, the founder of the rival Sports Direct chain and a close friend of Mr Ronnie, who brokered the loan on Sir David's behalf. Sir David and Mr Ashley have been involved in a bruising spat about when the loan was taken and whether it constituted a conflict of interest. Litres of bad blood have been spilt.

Mr Ronnie said: "I am speaking out as at the end of the day I have listened to some very close friends who have said 'You can't sit here and take this kicking'. I went through a five-month FSA inquiry [into his JJB stake] and I was exonerated."

Mr Ronnie said that the picture was not as black and white as has been portrayed and refutes much of Sir David's version of events.

He also said he was under the impression that Sir David was as focused on "how much he could get out of the business" as he was about saving JJB. In email sent from Sir David to Mr Ronnie on August 3 2008 – which has been seen by The Sunday Telegraph – Sir David talks about plans to take the chain private that would give him "a share of the action" and allow them all to "live happily ever after".

Mr Ronnie is bitter about the way things turned out. "Was I naοve? Bloody right I was. There were people around that board room who had an agenda I could never dream of," he claimed.

He also pointed out that JJB paid £120,000 to a company run by Sir David's son to carry out research into JJB's internet strategy. "We thought 'What the hell is he doing?'," said Mr Ronnie. Sir David's son, Stuart, is now working full time for the company. A source close to JJB said that although Mr Ronnie may have been unhappy with the research, he was involved in the decision to bring in the company in the first place as it was a board decision.

Mr Ronnie disputes JJB's version of events surrounding the loan from Mr Ashley. JJB has always maintained that the loan was "initiated" before Sir David became a non-executive director of the chain on October 1 2007. This date is important as the loan could be argued not to constitute a conflict of interest if it was arranged before Sir David joined the board. However, Mr Ronnie said that Sir David attended an audit and board meeting on September 24 – suggesting he effectively joined the board earlier than claimed. Mr Ronnie also said that he spoke to Mr Ashley about the loan on October 3, after Sir David had officially joined the board.

A friend of Sir David's said that he had indeed attended the meeting on the 24th "to see what JJB was like". However the company maintains that the loan was initiated before he joined.

Mr Ronnie said that Sir David had agreed "to come in to help on the corporate governance side" as a non-executive director. "I felt he was a really strong individual who I thought I could trust."

However he said he was "shocked" when he asked for the loan. "David Jones is someone I'd put on a pedestal and he's been there five minutes and he asked for the loan. That mystified me."

Mr Ronnie is also feeling bruised about the nature of his suspension in January and his subsequent dismissal in March.

When he was suspended, he claims that Sir David told him: "I will get you back here in three days because the business can't do without you". This did not happen and Mr Ronnie was eventually dismissed two months later. The JJB source dismissed the unequivocal backing of Sir David as "hogwash".

Of JJB's financial performance under his tenure, Mr Ronnie said that things under him "were not that bad", particularly when compared to the 26.5pc like-for-like sales fall that JJB reported last month. "Twenty-five per cent down. What is that man trying to do to the business?"

Mr Ronnie says that he has been deeply hurt by the events of the last six months.

"I was signed off work for stress for two months. It has had a huge effect on my family. We don't take papers in our house any more. I don't want my daughter coming into my room in tears," he said.

He says that his treatment at the hands of people at JJB makes the notoriously tough-talking Mike Ashley "look like Snow White".

Mr Ronnie fends off the oft-quoted opinion that he is Mr Ashley's stooge. "Am I Mike Ashley's puppet? No I am not.

"I had a career before I met Mike Ashley," said Mr Ronnie, who has also worked for Umbro, Diadora and Sports Division.

Mr Ronnie balks when asked whether he thinks he will work again. He has had such a trashing – and JJB has had such a bad time – that observers have queried it.

A JJB spokesman said: "Chris Ronnie was dismissed from JJB for gross misconduct without any compensation and chose not to contest that. He continues to make allegations which are either false, misleading or irrelevant. Whilst he was chief executive the company was taken to the brink of insolvency. The current management are focused on the future of the business and repairing the damage he caused."

Mr Ronnie, despite the brickbats, is looking to make a return to the sector. "I want to come back, but I want to come back stronger. I loved JJB. What I would like to do is get on with life. I want to get on in the industry. I know lot about it and have very strong contacts in it. I have a number of things I am looking at, but I have had enough of this. All I was interested in was making my investment safe and making sure it would work."
http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/5995505/Chris-Ronnie-ups-the-stakes-in-JJB-Sports-battle.html