Mike Ashley buys Sofa.com for “nominal sum”

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Mike Ashley ScS
// Mike Ashley’s Sports Direct has confirmed the purchase of Sofa.com
// Follows news that ScS pulled out of the running to acquire the company this morning
// All outstanding purchases will be honoured and no jobs cuts have been announced

Mike Ashley has fought off competition to complete his purchase of Sofa.com for an undisclosed sum.

According to Sky News, Ashley agreed late yesterday evening to purchase the online furniture retailer for a “nominal sum”.

The exchange was reportedly a solvent transaction, allowing the company to preserve the jobs of its staff, and that Ashley intends to honour all outstanding customer orders.

This follows news this morning that ScS, which was also in the running to acquire the embattled firm, said it was “no longer in discussions” with Sofa.com about an acquisition deal

It’s thought ScS backed out of talks as its bid was dependent on Sofa.com being under pre-pack administration, allowing ScS to leave behind its liabilities.

Sofa.com has concessions in House of Fraser, which Sports Direct bought out of administration in August last year.

The furniture retailer reportedly suffered after House of Fraser fell into administration last year.

ScS also has concessions in department store chain, but after they delivered lower sales and earnings in October it announced it would withdraw from seven House of Fraser stores.

Sofa.com subsequently revealed it would take the place of ScS across its House of Fraser concessions.

Ashley’s expression of interest in buying Sofa.com was the third business he had been trying to acquire since the start of the year, alongside attempts to buy HMV and Patisserie Valerie out of administration.

In the year to February 28 2018, Sofa.com saw its losses more than double year-on-year to £33.6 million, on a turnover of £28.8 million.

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