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Protests and boycotts impacting on Mike Ashley and Sports Direct wealth

2 years ago

Depending on who you believe, the crowd at St James Park on Sunday was in the region of 44,000-47,000 – credit to those who turned up to support the team and credit to those who chose not to.

I’m convinced we all share a love of Newcastle United and the vast majority detest Mike Ashley.

For sure, though the TV did highlight some rather empty areas of the stadium, it would be fair to say the ground did not look particularly empty on the TV and there is a temptation to conclude that the boycott failed and it was all for nothing.

We even have some of his apologists in the press claiming that losing 10,000 season ticket holders and only losing about 5,000-8,000 supporters on match day is a success for the Mike Ashley regime!

I disagree.

I think the one thing we can all agree on, is that Mike Ashley cares little for Newcastle but an awful lot about Sports Direct. In this regard I would argue that anything at all that adds to the toxicity of the Sports Direct brand is helpful to us, as only when NUFC becomes a drag on Sports Direct, as opposed to a source of free advertising, will he truly be a motivated seller.

There undoubtedly has been A LOT of adverse coverage on Mike Ashley recently, so does it have an impact ?

Well consider this :

As of today Sports Direct shares are about £2.30 each so the company as a whole is worth about £1.23bn, Mike Ashley owns approximately 60% of the company so his shares are worth something in the £700-£750m range .

But one year ago the shares were worth £4.00 each , making the company worth over £2bn and Mike Ashley’s share well over £1.25bn

And within the last five years shares have been as high a £8 each! At which point a 60% shareholding would have been worth over £2.5bn

So Mike Ashley remains a very wealthy individual but the value of his Sports Direct shareholding looks to have fallen by over £1.5bn in value…at a time when the stock market has generally been going up.

Of course I’m not suggesting that all (or even most) of this loss of value is due to NUFC fans protesting or boycotts – the general high street malaise, governance issues, employee relations, and of course the redoubtable Belgian tax man have all paid a huge part!

However, the business community does not like controversy and absolutely does not like to be associated with brands that are unpopular with the consumer.

I firmly believe all the protests against Ashley, the phone-ins, the questions in parliament, the demonstrations, and yes the boycotts, do have an impact, and in that context whatever route taken to lodge a protest has value and should be encouraged.


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