Sports Direct to drop out of FTSE 100 in reshuffle

* WM Morrison, Paddy Power and Betfair to join FTSE 100

* Informa and Mediclinic to also join FTSE 100

* Sports Direct, Aberdeen AM, Smiths, Hikma drop out

* Changes will take effect on March 21

By Sudip Kar-Gupta

LONDON, March 2 (Reuters) - Sports Direct andAberdeen Asset Management will drop out of Britain'sbenchmark FTSE 100 equity index after a slump in theirshare prices since the start of 2016.

Other companies to be relegated from the top British sharesindex will be diversified engineering company Smiths Group and Hikma Pharmaceuticals, the London StockExchange said on Wednesday.

Those four companies will be replaced in the FTSE 100 bygambling company Paddy Power Betfair, supermarketoperator WM Morrison, publishing company Informa and private hospital operator Mediclinic International.

Getting into the FTSE 100 can often fuel further demand fora company's shares, since funds that track the FTSE or invest inthe index can then add that stock to their portfolio, while theinverse is true if a company falls out of the FTSE 100.

Sportswear retailer Sports Direct, founded and majorityowned by billionaire Mike Ashley, had been impacted byallegations over the treatment of staff in Britain and a profitwarning. Sports Direct shares have 27 fallen percent since thestart of 2016.

In December, Sports Direct responded to critics of itsemployment practices with the launch of a review of conditionsfor its thousands of agency warehouse workers.

Aberdeen Asset Management's shares have also fallen around10 percent since the start of 2016, with the fund managementcompany hit by a slump in emerging markets.

The rankings are decided on market capitalisation. Companieswith the lowest market cap in the FTSE 100 drop into the FTSE250 mid-cap index, and vice versa.

The changes will take effect on March 21. (Reporting by Sudip Kar-Gupta; Editing by Danilo Masoni)