LONDON (Alliance News) - Home shopping and education supplies business Findel PLC on Friday said it is holding talks with sports clothing and equipment retailer Sports Direct International PLC about a possible supply agreement which would see Sports Direct founder Mike Ashley become Findel's chairman.
Findel said it is in the early stages of talks with Sports Direct on a possible commercial supply agreement between its Express Gifts business and Sports Direct.
Under the proposal, Ashley, the executive deputy chairman of Sports Direct, would replace outgoing David Sugden as Findel chairman.
Findel said the proposal was made by fund manager Schroders PLC, which owns a 20% stake in Findel, and has been supported by Toscafund Asset Management LLP, which owns 9.9% of Findel. Sports Direct itself owns a 17% stake in Findel.
Findel said it believes there to be "great merit" in exploring a commercial supply deal with Sports Direct and said "Mike Ashley could make a valuable contribution to the board of Findel", but has yet to decide whether Ashley should become chairman.
Later Friday, Sports Direct confirmed the early-stage talks and the potential appointment of Ashley to the Findel board.
It said that, like Findel, "Sports Direct considers there to be great merit in exploring these arrangements" but noted it was acting on its own behalf and independently from Schroders and Toscafund, though it did welcome their support for the proposals.
Findel and Sports Direct both said there is no certainty an agreement will be reached.
Findel shares were up 14% to 200.00 pence on Friday following the announcement, the best performer in the FTSE All-Share. Sports Direct shares were down 1.9% to 313.50p.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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