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What on earth is Mike Ashley’s game?

If you’ve been paying even cursory attention to the retail market over the last 18 months, you will know that the founder of Sports Direct, the billionaire Mike Ashley, has been on a mission to buy up the high street.

As news of the torrent of CVAs and administrations has come in, hot on their heels came offers from Ashley. Acquisitions thus far have included stakes in Debenhams, House of Fraser, Evans Cycles, Sofa.com, and today, it was announced Jack Wills. He also attempted to buy Game and HMV but was pipped by rivals.

As an extremely successful retailer in the field where he started – sportswear – it’s not surprising that he wants to capitalise on his much stronger financial position to become a king of bricks-and-mortar. There must be a certain allure to having entered as a mail order sportswear brand and ending up owning many of the great institutions of British retail just a couple of decades later.

But the speed at which he is expanding the empire, and the scale of the businesses he is taking on invites some scrutiny as to what on earth he is thinking.

Does he really imagine that he can turn around all these ailing businesses, and render them profitable when legions of experienced retail executives could not? What Midas touch does he possess that can turn back the tide of assaults on high street retail that is subsuming stalwarts wherever you look?

The most recent set of accounts – which it must be noted came before the acquisition spree – showed profits at Mash Holdings, which he uses to control his stakes in everything including Newcastle United, fell from £227.7m to £102.5m. It seems safe to assume that banks will not be too enthusiastic to lend him tens of millions knowing that it will be spent on collapsing retail chains. And by extension therefore it would stand to reason that a lot of this activity is being funded by Mash’s own cash reserves.

Other well-known retail figures have their doubts about the wisdom of seeking to soak up as many brands as possible. Stuart Rose, the former boss of Marks & Spencer, said in April this year: “My view in retail is to stay nimble, lean and mean. You need to be able to turn on a sixpence. I wouldn’t want to lock myself into anything that’s not flexible – we’re operating in a fast moving world.”

All of this makes one wonder if Ashley plans for any of the brands he is purchasing to survive. A huge estate of square footage for brands that were on the verge of collapse does not sound like a compelling proposition or money well spent, unless there is something else imagined for them. Perhaps he simply intends to licence the brands out to other foolhardy mugs and rake in a high street’s worth of franchise fees. Or where those acquisitions owned any freehold, lease the units.

But one thing’s for sure: if the collective brainpower of the management teams of all those brands couldn’t turn things, Mike Ashley is unlikely to have a miracle key to do it on his own. Watch him closely, because he’s got something else in mind.

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