Mike Ashley will step down as a director of Frasers after this year’s annual general meeting on 19 October but will continue to act in an advisory capacity when called upon.

As a parting gift, he is providing £100m of additional funding alongside. and on the same commercial terms, as the group’s existing unsecured borrowing facilities that were announced on 1 December 2021.

His departure from the board of the group, which also includes Sports Direct and Evans Cycles, comes just a week after the company was re-admitted to the FTSE 100 index of leading shares, marking some good news for the battered retail sector.

He said: “Since Michael Murray took over the leadership of Frasers Group earlier this year, the business has gone from strength to strength.

“It is clear that the Group has the right leadership and strategy in place and I feel very confident passing the baton to Michael and his team. 

“Although I am stepping down from the board, I remain 100% committed to supporting Frasers and Michael’s plans and ambitions, and I look forward to helping the team as and when they require me.  My commitment and support as a Frasers’ shareholder is as strong as ever.”

Michael Murray, CEO, added: “Mike has built an incredible business over the past 40 years and, on behalf of the board and the group, I want to thank him for all he has done. With our new strategy and leadership team, we are driving this business forward at pace and we are all excited for the future.

“We are grateful to have Mike’s support and expertise available to us as we continue the next stage of Frasers Group’s journey.” 

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Russ Mould, investment director at AJ Bell, said: “News that Mike Ashley is stepping down from the board feels like a seismic moment for Frasers Group.

“Ashley has been so synonymous, for both good and bad, with the retail empire which has grown out of the Sports Direct brand that his departure, even if he will remain a major shareholder and adviser to the company, is a big shock.

“He may have divided opinion in the City, but his entrepreneurial skills still helped take the business from a single store in Maidenhead to one of the UK’s largest retailers.

“Without him on the board Frasers may have a bit of an identity crisis. Ashley’s strategy of buying fallen competitors and adopting a ‘pile them high, sell them cheap’ approach to retail may have attracted criticism but it had some clarity to it.

“Without him, will Frasers management have the same level of ruthlessness or will it start to look like a bloated and unfocused business at a time when the pressures on the industry are very acute?

“A lot will fall on the shoulders of the current CEO and Ashley’s son-in-law, Michael Murray, which shows that Ashley is literally keeping the leadership of the business he built in the family.”