New battle between Blacks and Sports Direct

A FRESH war of words has broken out between Blacks Leisure and Sports Direct amid claims that suppliers would pull their goods out of Blacks' stores if a takeover by the chain's biggest shareholder succeeds.

Sports Direct, run by maverick businessman Mike Ashley, owns 28.5 per cent of Blacks and has blocked a fundraising by the outdoor clothing and equipment specialist, while a takeover proposal was rejected earlier this month.

The sportswear chain said it was weighing up a "material increase" in its offer – but delivered an ultimatum to Blacks on Friday to give details of key suppliers who would not supply the business if the Sports World owner won control.

Sports Direct accused Blacks of selectively disclosing the names of unsupportive suppliers contrary to takeover rules – and threatened to go to the Takeover Panel if it failed to give up the names within two hours.

Blacks denied the claims and said it had immediately referred Sports Direct's letter to the panel.

Yesterday's stock exchange statements by the two firms followed weekend reports of fears among some suppliers over Ashley's reputation as a heavy discounter.

Blacks snubbed a 26 million takeover approach from the Newcastle United owner two weeks ago as "wholly inadequate".

Shares in Blacks rose 12 per cent to 70.5p, while Sports Direct gained 1.7 per cent to 110.5p.

Sports Direct's letter said it was "giving serious consideration" to a much better offer but did not indicate the likely size of the increase, Blacks added.

Blacks, whose history stretches back to the 1860s, when Thomas Black set up a sail-making business in Greenock, announced plans for expansion through a 20m fundraising earlier this year, although the proposals foundered on opposition from Sports Direct.

The retailer, however, plans to sidestep Sports Direct's opposition to its plans by restructuring the vote in a way that only requires a simple majority of shareholders.

Blacks, which operates more than 300 own-branded, Millets and Freespirit outlets, is rebuilding after a difficult period when it closed 87 loss-making stores late last year.

The firm wants to refurbish its core estate and reopen shops in areas where it closed stores that it felt were subject to high rents and therefore loss-making despite strong sales.

Earlier this month it emerged that the group was opening a new store in Glasgow as part of a programme for five new stores being funded by cashflow after strong trading over the festive period.

Blacks employs about 5,500 staff in stores and at its head office and distribution centre in Northamptonshire.