By  on March 2, 2017
Mike Ashley

LONDON — British billionaire Mike Ashley, the controversial Sports Direct owner and target of a 2016 parliamentary investigation into “appalling” working conditions at his shops and warehouses, is the new owner of lingerie brand Agent Provocateur.Over the past week, speculation had been rife that Ashley’s Sports Direct, Britain’s largest sports retail outlet, was among the front-runners to buy Agent Provocateur alongside Lion Capital, which had been working with Bendon, the Australian lingerie company.In the end, Four Holdings, the slick fashion showroom and marketing company in which Ashley has a large stake, purchased Agent Provocateur. The lingerie brand, which had fallen on hard times, was placed briefly into bankruptcy protection before the sale, which was revealed on Thursday.The move dovetails with Ashley’s ambitions to move upmarket — and plays to his taste for snapping up shares in ailing businesses. His holdings range from the mass-market Sports Direct stores to the multibrand fashion retailer Flannels. He is also the owner of Newcastle United Football Club.Last year, he splashed upward of 100 million pounds, or $124 million, on a property on Oxford Street to house a Flannels flagship, and has said his plan is to transform Sports Direct into “the Selfridges of sports.”British media reports said Ashley had tabled an offer of 27.5 million pounds, or $34.2 million, for Agent Provocateur last week, although that figure was never confirmed, and the terms of Thursday’s deal were not disclosed.Agent is Ashley’s second fashion acquisition in as many months: In early February he acquired 11 percent of another struggling retailer, French Connection. He also has stakes in House of Fraser, Debenhams and JD Sports. Last year Sports Direct, which was founded in 1982 and has nearly 700 stores worldwide, bought a 9 percent stake in Iconix.On Thursday, shares in Sports Direct closed down 0.8 percent to 2.97 pounds, or $3.67.Four Holdings is the parent company of Four Marketing, which represents more than 30 brands including Stone Island, CP Company, Paul & Shark and Velvet by Graham & Spencer.The company also owns the London flagships of those brands, and operates the relevant e-commerce sites. Four Marketing has also just opened multibrand stores called 18montrose in Glasgow, Scotland and in Nottingham, England.RELATED STORY: Agent Provocateur to Downsize Stores, Staff > >Charles Perez, chief executive officer of the Four Holdings Group, said Thursday: “The global status of Agent Provocateur provides significant opportunities, and we are excited to begin working to further grow the brand equity.”The turnaround consultancy Alix Partners had over the past weeks been hunting for buyers for Agent, which was owned by private equity firm 3i since 2007.Over the past year 3i had been grappling with balance sheet irregularities that had made Agent appear more successful than it was. The new ceo, Fabrizio Malverdi, who arrived last year, tried to steady the ship and was also involved in the process of finding a buyer.Earlier in 2016, 3i confirmed it would invest a further 4 million pounds, or $5.4 million, in Agent in the quarter ending Sept. 30, and wrote down the value of its stake in the company by 39 million pounds, or $53 million, in the first half.Last year Malverdi, who is tipped to become ceo of the Italian brand Brioni once he exits Agent Provocateur, shuttered 30 percent of the brand’s retail network, reduced headcount at its headquarters by 30 percent and phased down its diffusion line, L’Agent, which is designed by sisters Penélope Cruz and Mónica Cruz Sánchez.RELATED STORY: Gianluca Flore to Exit Brioni > >Agent Provocateur was founded in 1994 by Vivienne Westwood’s son Joseph Corré and his then-wife Serena Rees. The couple opened a boudoir-inspired store in London’s Soho stocking it with come-hither lingerie, while staff were dressed in sexy French maid uniforms.The brand grew steadily over the years, adding a series of successful fragrances that are currently under license with Interparfums; creating racy ad campaigns that rapidly went viral and broadening the offer with a small, high-end ready to wear line and the second line, L’Agent.But the brand also made some big missteps. It was adamant about not wholesaling the main collection (with the exception of Net-a-porter) and it expanded at breakneck speed in the U.S. and Europe, often opening in poor locations and without sufficient infrastructure to support the business.It also fell victim to the Russian economic and political crisis — with once-flush travelers forced to spend their devalued Rubles at home. Former ceo Garry Hogarth departed in February 2016 while the balance sheet irregularities were only discovered after Malverdi’s arrival.With Ashley now behind the business, there will no doubt be more controversy in store.Last summer, around the same time another British billionaire retailer Sir Philip Green was arguing with parliamentarians about the hole in the BHS pension fund, Ashley found himself the target of a separate committee investigation into Sports Direct's work practices and business model.RELATED STORY: Sir Philip Green Castigated by Parliamentary Report > >Last July, following an investigation, Parliament’s Business, Innovation and Skills Committee published a scorching report describing the Victorian conditions at Ashley’s warehouses and shops.The report said workers “were not being paid the national minimum wage, and were being penalized for matters such as taking a short break to drink water and for taking time off work when ill. Some say they were promised permanent contracts in exchange for sexual favors. For this to occur in the U.K. in 2016 is a serious indictment of the management at Sports Direct.”The parliamentary report went on to describe Sports Direct as: “A particularly bad example of a business that exploits its workers in order to maximize its profits,” and promised to hold “Mr. Ashley’s feet to the fire, so as to see what progress he has made on improving working conditions for workers at his premises.”Ashley told committee members that he took full responsibility for Sports Direct, admitted the company had broken the law by not paying staff national minimum wage and promised to address any shortcomings in the working practices at the retailer.RELATED STORY: Mike Ashley’s Sports Direct Buys In at Iconix > >

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