Ashley’s last-ditch equaliser sends the game for Elverys into extra time

Mike Ashley, the billionaire owner of Newcastle United who is now circling Elverys Sports, obviously knows a thing or two about football.

In the sport’s parlance, he was one-nil down with five minutes to go on Sunday evening, when Nama was hours away from signing off on a €10 million management buyout of Elverys to pay off some of the debts of its founders, the Mayo-based Staunton brothers.

With a last gasp effort, Ashley let it be known that Sports Direct, the company he controls, had offered 25 per cent more for the business and took the game into extra time. Nama, with the acquiescence of the Stauntons, yesterday scuppered management's buyout plan by placing Elverys into examinership.

Determined style
The MBO, which did well to raise its €10 million, is now most likely toast. Sports Direct, which owns 50 per cent of Heatons department stores, looks determined to get its hands on Elverys and has access to resources of which its rival bidder could only dream. Ashley, known for his determined and direct business style, will take some beating.

He flew into Dublin over the weekend on the understanding that he would be allowed into the sale process. Apparently, he spent much of his 48 hours here waiting in various solicitors and accounting firms to be allowed make a bid, hence his decision to publicly air his frustration on Monday.

But apart from management, Ashley is not the only one with designs on the business. Lifestyle Sports, owned by the Stafford group, also retains an interest in Elverys.

Could it make an offer to the examiner in some form of partnership with Sports Direct? The two companies are known to have a good working relationship.

When Sports Direct bought its UK rival JJB out of administration in 2012, it cherry-picked the best stores that it wanted to keep. The rest, more than 100, were allowed to close.

Taoiseach's bailiwick
If it got control of Elverys, it is likely that Sports Direct would want to close a large number of the stores. But it would also be likely to open other, larger-format stores. The Irish company's distribution centre, located in the Taoiseach's Mayo bailiwick of Castlebar, would probably be under threat, however.

If Sports Direct bid with Lifestyle, it would soften any insinuation that it was an aggressive outsider coming into Ireland to prey on a struggling business. They could break up Elverys between them with Lifestyle, which wants to expand further, taking over some outlets while leaving others – probably the largest ones, to Sports Direct.

Court-sanctioned mission
Part of the examiner's court-sanctioned mission is to preserve as many jobs as possible, however. Whoever bids for Elverys will have to bear this in mind. Nama is unlikely to vote for any rescue plan that hinges on tearing the heart out of the business.

The agency was blindsided by Ashley’s public pronouncement in these pages on Monday that he was willing to pay a 25 per cent premium over the mooted MBO. Nama sees a transparent examinership as a way to ensure that it is not accused of doing any backroom deals while locking out other bidders.

Many outside observers, however, are mystified as to why the agency saw fit to sanction a pre-pack receivership in the first place. Why did it not just put Elverys on the blocks and sell to the highest bidder?