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Mike Ashley in advanced talks for £100m shopping centres deal

// Mike Ashley is poised for a £100 million spending spree on shopping centres including the Overgate in Dundee
// Mr Ashley is known to strike a hard bargain and as such sources say there is no guarantee a deal will be done

Retail tycoon Mike Ashley is lining up a £100 million shopping centre swoop amid hopes that the fall-out in the sector is stabilising.

Ashley’s Frasers Group is in advanced talks to buy the Overgate centre in Dundee for £30m, along with The Mall in Luton in a £70m deal, The Times reports.

Frasers is said to be timing its acquisitions to coincide with hollowed-out valuations and an expected upturn – a prospect that may unsettle his retail rivals, who would end up as his tenants.

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Frasers’ interest in buying the Overgate centre would leave a big loss for Legal & General, which paid Landsec £125 million for Dundee’s main shopping destination nine years ago. Sports Direct and USC both operate stores in the centre.

The retail giant is on a bargain hunt after the rise of online shopping, which led to a significant excess of shops and had a cataclysmic effect on UK shopping centres.

Since June 2018, almost £8 billion has been wiped off their value, a drop of 67%, according to data from MSCI Real Assets.

The Mall in Luton is being sold by the lender Wells Fargo, which has in effect taken control of the asset from its previous owner, the listed landlord Capital & Regional.

Frasers, which already operates a Sports Direct store in The Mall, is planning to carve up the centre’s former Debenhams store into outlets for Frasers-owned chains such as Flannels and USC.

Sources cautioned that while Ashley was in pole position to buy both assets, he was haggling over price and it was not certain that the deals would be done.

After a strong recovery from the pandemic, Frasers is hunting for acquisitions. The group, now led by Ashley’s son-in-law Michael Murray, has taken stakes in Hugo Boss, and in the online retailers Asos and N Brown, which have both suffered heavy share price declines.

The group has made a flurry of acquisitions over the past year, snapping up Studio Retail Group, Missguided and I Saw It First.

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