Updated: Jul 26
Mike Ashley strutted into Tyneside, having acquired Newcastle United from John Hall and Freddy Shepherd for the princely sum of £135m, in the July of 2007.
The beer swigging, Toon top wearing, ‘cheeky cockney’ was quick to try and cement some kind of best mate relationship with the Newcastle fans, sporting a replica shirt which was a little too tight and standing on the terraces in those first few weeks. A business man of some repute, building his sports and retail brand from nothing, literally lending the money from his parents, into a household brand and multimillion pound business.
Little did Newcastle fans know what was to come.
As the clock ticks up to 13 years in charge there were some early signs that there was a rocky road ahead. What would become an infamous ‘interest free loan’ his way of ensuring that the books held a fee owed personally to him over over £100m. This the result of his own lack of ‘due diligence’ according to his own account of the situation the club was in when he bought it.
But as the years rolled on and the cash rolled in there were far more serious questions to answer about his running of the club. Here are just a few, that those who hold the club most dear, will never forget:
Naming St James Park the ‘Sports Direct Arena
The red and blue Sports Direct logos on every visitable inch of flat surface in the stadium
The renaming of Shearers Bar to ‘Nine’, apparently not to do with the pair falling out
The appointment of Dennis Wise as Director of Football?!
The staggering appointment of Joe Kinnear???!
The sale of the land behind St James Park preventing development of the ground!
Letting Rafa leave (the straw that broke the camels back for many, including WorFlags walking away)
And in all this time, where has the money gone?
According to the Sunday Times Rich List 2019 Mike’s finances have taken something of a hit in recent times. Whilst his net worth is estimated at £1.97bn, whilst a quite mind boggling figure, is down a staggering £461m from the previous year.
That loss would have been likely to be wiped out in the 2020 report however, as in December 2019 there was a sharp jump in the share price of the now rebranded Frasers Group PLC (previously Sports Direct). With a number of his high street businesses previously struggling, news in December that that the high street store was reporting a profit before tax increase of 160% had a hugely positive effect on the worth of the company. With his ‘Flannels’ premium band booming and even Sports Direct seeing an increase of 6.2% Mike Ashley’s group increased by 43.8% from the first half of the year. But then COVID19 struck. With Ashley already having mulled over bids before, on one occasion reportedly changing his mind about selling his prize billboard, that is Newcastle United, the slump in the markets due to the pandemic seems to have been the tipping point perhaps.
As recently as February of this year, Ashely had added to his empire with the purchase of a 12.5% stake in Mulberry. His stake adding to his collection of an ever growing list of ‘higher end’ high street brands including Jack Wills, Evens Cycles, Sofa.com, French Connection and Game Digital. This of course is in addition to those companies already in the Ashley stable, trading under his Fraser Group banner which include Lillywhites, Donnay, Slazenger, Kangol, Karrimor and Lonsdale.
You’d be mistaken for thinking that this move ‘upmarket’ might be reflected in the branding at St James Park. One thing that Mr Ashley is known for is being brutal in the running of his empire. The branding around Sports Direct, perhaps even the negative connotations that come with the stories of poorly paid workers and substandard working conditions, almost play directly into the moguls hands. Everyone knows that when you walk into Sports Direct you’re getting the cheapest version of whatever it is you’re looking for. Why would he be interested in changing this narrative. This, after all, is the entire premise of this business and it’s subsequent success. Running Newcastle United on a shoe string just reinforces the message.
And that lack of even a modicum of ambition has translated to the club drifting into obscurity when it comes to top flight English football.
In the 12 full seasons before Ashley arrived at the club Newcastle finished in the top four 4 times, reached 2 Cup Finals, played in Europe for all but two of those season and finished second twice. They were not relegated once in his period. Under Mike Ashley, over the same period, there have been two relegations, no Finals (not even a Semi) and just the single trip into Europe under Alan Pardew.
Newcastle United are currently nothing but an empty shell of a club in real terms, with little but the passion of the fans, and a stadium he couldn’t sell (as the land didn’t belong to him) to show for Ashley’s tenure.
You see, Mike doesn’t lose. He’s a canny businessman and where most see risk, opportunists see profit. The freeing of capital right now presents the perfect opportunity for him to strengthen his grip on his existing portfolio of companies or to venture further into this world. With share prices slashed as much as 60%-70% for even some premium brands you’d have to imagine Mike’s eyes have lit up.
This, whilst considering his lack of investment both on and off the pitch over a sustained period has brought Newcastle to it’s knees means the value of this asset is on a cliff edge. Go down and he could stand to lose all it’s worth right now.
And this, in a nut shell, seems to have finally pushed him into making the decision to sell the club at last.
For those of us old enough to remember happier times we can only dream of getting even a sprinkling of such joy once again. For the younger ones we can only hope that it’s a case of ‘you only appreciate the highs when you’ve been through the lows’. And my god we’ve had our share under Ashley.