The tycoon, whose empire also includes House of Fraser and Evans Cycles, is set to hand power to his future son-in-law.
Sports Direct founder Mike Ashley is to step down from leading his retail empire and hand the reins to his future son-in-law.
The board of Frasers Group, which also owns House of Fraser, said talks were under way for Michael Murray, 31, to succeed the billionaire on 1 May 2022.
The move would see Mr Ashley step down as chief executive but remain on the board as an executive director.
Mr Ashley founded Sports Direct in 1982 and retains 64% of the group.
Mr Murray, engaged to be married to Mr Ashley’s daughter Anna, is currently “head of elevation” at Frasers and is in charge of modernising stores and transforming the business.
Chris Wootton, Frasers Group’s finance chief said the direction of travel to hand over more power to Mr Murray had been in place for a while.
“Without insulting him, by Mike’s own admission he is a bit of a dinosaur. Michael is young, fresh and youthful and knows what the customer wants. Mike is very good at selling socks,” Mr Wootton told The Times.
In stock market statement, Frasers Group said it was “currently proposed” that Mr Murray would assume the role of chief executive, with a “reward and remuneration package” now being considered.
“The board consider it appropriate that Michael leads us forward on this increasingly successful elevation journey,” Fraser’s Group said.
Mr Murray has been working for the group for several years, but his role at the company raised eyebrows after reports about him being paid millions of pounds in consultancy fees.
Mr Ashley was previously executive deputy chairman of the retail group – which changed its name from Sports Direct International to Frasers Group last year – until 2016, when long-serving chief executive Dave Forsey resigned.
Mr Ashley, 56, has been one of the High Street’s most prominent and colourful figures since founding his business.
He first entered the fitness industry as a squash coach before opening his first high street sports shop in Maidenhead, Berkshire, in 1982.
Through the early 1990s, he expanded to a chain of stores rebranded as Sports Soccer, and had a portfolio of about 100 shops by the turn of the millennium.
The noughties saw more rebrands before the business found its current guise of Sports Direct and in 2007, Mr Ashley floated the business as a public company in a move which valued it at £2.5bn.
Later that year, Mr Ashley became a significantly more recognisable figure when he bought majority control of Newcastle United. However, his tenure has come under criticism from fans over his ownership style and perceived lack of investment. He is currently seeking a sale after the collapse of a £300m deal with the Saudi Public Investment Fund.
Away from football, he has rapidly grown his retail operation in recent years, snapping up a number of distressed British brands including House of Fraser, Evans Cycles, Jack Wills and Game.
The group is now worth around £3bn and operates almost 1,000 shops.
However, there has been controversial moments.
In 2016, a parliamentary inquiry accused Mr Ashley of running Sports Direct like a Victorian workhouse after a report by the Business, Innovation and Skills (BIS) Select Committee said the company had used “appalling working practices” and treated “workers as commodities rather than as human beings”.
The group has also come under heavy criticism over its use of zero-hours contracts for workers.
London’s High Court heard that the businessman once hosted a management meeting in a pub where he drank 12 pints and vomited into a fireplace.
Mr Ashley apologised in March 2020 after a series of blunders in the way his chain has reacted to the first coronavirus lockdown.
The retailer lobbied the government to keep his shops open, arguing they were an “essential service”, but backed down after a backlash from staff and media.
The retail veteran’s decision to back away from the chief executive position appeared surprising but retail analysts have said they think it could still be “business as usual”.
Retail analyst Richard Hyman said: “Perhaps there is a move here to give Michael Murray more limelight and draw more focus to this elevation strategy he has been leading.
“I really think we need to be careful not to look too much at this company through a corporate lens, because it doesn’t matter what titles they have, this is Mike Ashley’s business and he will have final say.”
A graduate from the University of Reading, Mr Murray set up his own property consultancy in 2015. One of his clients was Mike Ashley’s Frasers Group.
His consultancy firm is tasked with finding and negotiating deals for new Sports Direct and other retail shops across globe, as well as providing advice on the company’s existing sites.
He was appointed “head of elevation” for Frasers Group in January 2019, with his job to modernise the business. One of his main projects was the development of Flannels, which is among Mr Ashley’s retail empire.
“I looked at Flannels and thought it could be so much bigger than it was,” Mr Murray said in an interview. “Five years ago, it was a sleepy business, so I developed a strategy, Mike signed it off and we started rolling it out. Three years later, we’re opening in Oxford Street.”
In an interview with the Guardian following the opening of a Flannels flagship store in Leicester, Mr Murray said him and Mr Ashley were “working like a partnership”.
“I’m thinking about the next 10 to 20 years. He looks after the back end – systems, logistics – I look after customer-facing side and the image of the business,” he said
He is now Ashley’s righthand man, and soon to be one of the family, after becoming engaged to Mr Ashley’s daughter.
Frasers Group revealed the leadership change in its latest full-year trading figures on Thursday, in which it said its revenue fell 8.4% to £3.6bn from £3.9bn in 2020.
Its sports retail revenue also decreased by 10.7% from £2.2bn to £1.9bn due store closures caused by the Covid-19 pandemic, the company said.
Pre-tax profits also dived by 94.1% to £8.5m for the year to 25 April, compared with £143.5m in the previous year.
In a statement Mr Ashley said: “Our stores in the UK have reopened above expectations and our online channel continues to significantly outperform pre-Covid-19 periods.
“None the less, management remains of the view that there is a high risk of future Covid-19 pandemic restrictions, likely to be over this winter and maybe beyond.”
This is a real changing of the guard. Mike Ashley is one of the most colourful figures in British retail who started out with a single store in Maidenhead and turned it into a £3bn business.
Unconventional and brash, he’s ruffled plenty of feathers along the way and liked to cock a snook at the City. But he’s also a shrewd and canny businessman and in recent years has snapped up a host of big names out of administration.
He took on the role of chief executive in 2016, promising to “fix” the business after it came under fire for poor working practices at its main distribution centre. Now he clearly feels it’s time to hand over the reins to his daughter’s fiancé.
Mr Murray has won plaudits for how he’s transformed a number of stores, including the new flagship Sports Direct store in London’s Oxford Street.
At the age of 31, Mr Murray is now set to be catapulted into the top job in charge of some 1,000 shops and more than 20,000 employees.
He’ll certainly bring a younger, more modern, face to this sprawling retail empire but he has some huge trainers to fill as Mike Ashley prepares to step back.