Frasers Group makes strategic investment in Hugo Boss

Mike Ashley's Frasers Group is continuing with its strategy of making strategic investments in brands and retailers by taking a stake in luxury brand Hugo Boss.

The investment comprised 120,000 shares of common stock, representing 0.2% of Hugo Boss's total share capital, along with 140,000 shares of common stock via contracts for difference, representing 0.2% of Hugo Boss's total share capital and 3,290,000 shares of common stock via the sale of put options, representing 4.7% of Hugo Boss's total share capital.

Frasers said the move was a demonstration of its "growing relationship with Hugo Boss and belief in Hugo Boss' long-term future". It added that it intended to be "a supportive stakeholder and create value in the interests of both Frasers Group's and Hugo Boss' shareholders."

It has long been Ashley's modus operandi to take stakes in brands in which he has an interest. He previously held an almost 30% stake in Debenhams before it was removed from the Stock Market after falling into administration and being bought by a consortium of its investors, and also holds a sizeable stake in struggling mid-market chain French Connection.

However his latest investments have taken him more upmarket, perhaps reflecting his desire to "elevate" the House of Fraser department store brand and the rapid growth of his luxury chain Flannels. In February of this year he took a 12.5% stake in British luxury fashion accessories house Mulberry.