Mike Ashley's Sports Direct had bought luxury lingerie business Agent Provocateur following news at the weekend that it had lodged a £27.5m bid.
The business was acquired from administration today in a so-called pre-pack deal that allows buyers to cherry pick assets without taking on certain liabilities. Ashley used his Four Holdings vehicle, which is the parent company of fashion agency Four Marketing in which Sports Direct holds a significant stake, to complete the deal.
Agent Provocateur was previously owned by private equity house 3i, which bought a controlling stake from Joe Corré, its co-founder and the son of fashion designer Dame Vivienne Westwood, for £60m 10 years ago.
Last year 3i was forced to write down the value of the business by £39m and inject more cash into it following accounting irregularities and tough trading.
Restructuring experts Alix Partners were brought in to turn the business around ahead of a sale process, which was handled by Rothschild. Among the bidders were believed to be French retailer Etam and venture capital firms Terra Firma and Lion Capital, the latter of which is reported to have fought hardest against Sports Direct to win the business.
It is believed Ashley will retain Agent Provocateur's 10 UK stores and reports have suggested he may sell the brand in his Sports Direct stores in a bid to take them more upmarket. However Ashley also owns designer fashion chain Flannels, as well as Four Marketing and recently acquired a stake in struggling fashion retailer French Connection.
In a statement Alix Partners said: "We would like to thank all the staff and stakeholders for their support during this process and we wish the business and its new owners all the best for future."
Corré, however, has branded the deal "a disgrace" and has warned of legal action against 3i claiming a higher bid for the business was rejected.