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Mike Ashley now admits in court papers how much Sports Direct paid to Newcastle United

1 week ago
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December 2021 saw Mike Ashley begin legal proceedings against Amanda Staveley.

The former Newcastle United owner claiming that the member of the consortium now owning the football club, had broken the terms of an agreement.

That agreement saw Mike Ashley loaning Amanda Staveley £10m to cover costs incurred in the takeover transaction and Ashley demanding immediate repayment because he claimed Ms Staveley broke certain conditions on which the loan was made.

The Mail reporting in February (2022) that they had seen papers filed to the court by Amanda Staveley in response to Mike Ashley’s legal action, with some very interesting claims made regarding Mike Ashley and what his Sports Direct / Frasers did (or didn’t!) pay for the overwhelming promotion of his retail empire…

‘Details of sponsorship payments to Newcastle from Sports Direct and designer fashion chain Flannels – another Mike Ashley firm – have also been disclosed by Staveley’s lawyers.

They claim the new owners discovered only after the transaction that Newcastle had ‘not received any sponsorship fees in respect of the Sports Direct or Flannels signage for the 2019/20, 2020/21 or 2021/22 seasons’.

The issue of sponsorship rights was first mentioned in Ashley’s claim in December. In that, he said Newcastle’s new owners prematurely terminated an agreement with Sports Direct.

He said Staveley rowed back on an alleged assurance that she would ‘endeavour insofar as possible’ to maintain Sports Direct’s sponsorship deal until the end of the 2021-22 season in May. A month after the acquisition, Staveley told Ashley that the sponsorship would end.

Correspondence shows that Ashley unsuccessfully tried to prolong Newcastle’s notice period to terminate Sports Direct’s sponsorship rights from 14 to 90 days.

Staveley has said the decision to end the sponsorship was in part due to the high street retailer ‘not paying any fees’ in return for its rights.

Legal papers state ‘there was self-evidently no commercial benefit in retaining the Sports Direct or Flannels signage’.’

So, for Newcastle United fans, the key claim from Amanda Staveley was that ‘Newcastle had ‘not received any sponsorship fees in respect of the Sports Direct or Flannels signage for the 2019/20, 2020/21 or 2021/22 seasons’.’

Who was telling the truth – Mike Ashley or Amanda Staveley?

Well, Amanda Staveley and husband Mehrdad Ghodoussi filed their written defence to Ashley’s claims on 12 February 2022.

Now today (Monday 20 June 2022), The Athletic have revealed that Mike Ashley made an amended claim last Wednesday (15 June 2022):

In his amended claim, Ashley says that his company, Sportsdirect.com Retail Limited (SRL), was “due” to pay £2 million per season for “particular signage” at St James’ Park and the club’s Benton training ground from the 2019-20 Premier League campaign.

“However, while the sale was being negotiated during the 2019-20 Premier League season,” the document reads, “SRL did not pay the sponsorship fees so as not to increase the cash position balance sheet outside of the pending sale agreement.” Ashley insists that SRL did pay a £1 million “annual fee” in each of the 2017-18 and 2018-19 seasons for these “sponsorship rights”.

So….now Mike Ashley has finally admitted that indeed not a penny was paid for the overwhelming Sports Direct (and associated brands) advertising for the entire 2019/20 season, the entire 2020/21 season AND the entire 2021/22 season.

Yet, a key part of the Mike Ashley December 2021 claim against Amanda Staveley was that ‘He (Mike Ashley) said Staveley rowed back on an alleged assurance that she would ‘endeavour insofar as possible’ to maintain Sports Direct’s sponsorship deal until the end of the 2021-22 season in May.’

A ‘sponsorship’ deal where Mike Ashley and his businesses didn’t pay a single penny in return for the horrendous advertising that blighted St James Park and the training ground. For three whole years not a single penny, yet Mike Ashley complaining when this arrangement was brought to a halt part way through the third of those years / seasons, after he had sold the club.

The Athletic also in their report today – 20 June 2022:

In a court order, issued by the Hon Mrs Justice Moulder, Ashley has been informed that he must pay Staveley and Ghodoussi’s costs in relation to “considering” the amendments. The Newcastle co-owners have until 4pm on Friday to submit their amended defence.

Within the latest filing, it is claimed that “there had been discussions in or around July 2021 about Mr Ashley retaining a small stake” in Newcastle following the proposed sale to the consortium, which included the Saudi Arabian Public Investment Fund (PIF), as majority 80 per cent shareholders, and the Reuben Brothers and Staveley’s PCP Capital Partners, who were each to hold 10 per cent stakes. Ashley claims that, while “PIF had been open” to him continuing as a minority shareholder, Staveley “was opposed to Mr Ashley’s continued involvement”.

From the outside, it looked like a major reason for Mike Ashley taking the legal action in December 2021 was because this had become personal with Amanda Staveley. Ashley wanting to go on the attack against her.

This revelation though about Mike Ashley trying to retain a stake in Newcastle United even after the sale of the club, with the Saudi Arabia PIF supposedly ‘open’ to this, only for Amanda Staveley to oppose it. It just gets better and better, in terms of how Newcastle United fans will view Amanda Staveley.

If indeed she has prevented Mike Ashley continuing to own a part of Newcastle United, then all credit to Amanda Staveley. That would have been a ridiculous scenario and massively hampered the club in trying move forward after the horrific 14+ years NUFC suffered under his ownership.

A third revelation in the reporting from The Athletic today, was that rather than being included in the £305m purchase price for the club, Mike Ashley’s amended court documents state that “shortly before closure of the 7 October transaction… a loan repayment of GBP 17,500,000 (was made) to Mr Ashley as per an agreement with the acquiring consortium.”

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