Sports Direct shares plunge
Shares in Sports Direct International plunged after its auditor quit without a replacement, heightening corporate governance concerns at the retailer controlled by billionaire Mike Ashley.
Grant Thornton will depart on September, Sports Direct said, as it seeks the services of a Big Four auditor, and the accounting firm is reviewing its client roster to ensure profitability.
Sports Direct shares fell in London as much as 13% at one stage and closed around 8.5% lower, bringing their decline over the past 12 months to more than 40%. It is now worth £1.1bn (€1.2bn)
The company last month reported a surprise tax bill from Belgium of €674m, the departure of its financial chief and deepening woes at department-store chain House of Fraser. Sports Direct repeatedly delayed publishing its annual results before reporting a fall in profit.
Newcastle United owner Mr Ashley also owns the Heatons fashion department store chain in Ireland, which has closed some outlets and merged others with Sports Direct.
“The shambles at Sports Direct is an endless tale, as long and convoluted as an Anglo-Saxon saga,” analyst Neil Wilson at Markets.com said in a note. The share decline follows “the latest sign of the complete and utter lack of control at the top.”
The retailer has held discussions with the UK government about appointing a new auditor, according to the Financial Times, after Sports Direct said in its annual results that Big Four firms declined taking on the role because of conflicts.
Mr Ashley continues to snap up struggling UK retailers, including clothes retailer Jack Wills earlier this month. But he faces growing doubts among investors about his ability to turn around the brands.
