Ex-NUFC boss Mike Ashley's Frasers Group snaps up £3m stake in rival retailer
by Henry Saker-Clark PA Deputy Business Editor · ChronicleLiveMike Ashley's Frasers Group has made a strategic move by acquiring a £3 million stake in Marks Electrical, boosting the online white goods retailer's shares in early Tuesday trading.
In a recent stock market announcement, Marks disclosed that Frasers purchased 6.73 million shares, granting them a 6.4% interest in the Leicester-based company.
Despite this, the majority control remains with founder Mark Smithson, who holds over 70% of the business.
Earlier in the month, Marks Electrical reported a dip in half-year profits as consumers opted for less expensive products due to financial pressures, with adjusted earnings falling to £2 million for the six months ending September 30, compared to £2.3 million in the previous year.
This occurred even though revenue rose by 9.3% to £58.8 million for the half-year period. Frasers' investment follows a decline in Marks shares to their lowest point since the company's 2021 London floatation last week.
This is Frasers' latest venture into the electricals sector, having previously acquired approximately a 23% stake in competitor AO World.
A spokesperson for Marks Electrical welcomed the investment, stating: "The board welcomes Frasers as a shareholder in Marks Electrical."
"Their investment represents a vote of confidence and also demonstrates the significant upside potential in our business as we focus on building the UK’s leading premium electrical retailer and delivering long term value creation."
The company's shares experienced a 1.3% increase, standing at 51.15p.
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