Billionaire tycoon Mike Ashley is believed to be eyeing up fashion chain Hugo Boss (BOSS.DE), causing shares in the German retailer to jump on Friday.
Frasers Group (FRAS.L), which owns Sports Direct, Jack Wills and Evans Cycles, already has a 15.2% in Hugo Boss.
According to the Telegraph, which cited a German publication, Ashley is mulling a takeover bid for the entire firm for more than €3.2bn (£2.7bn, $3.9bn).
Frasers, which has been buying up more shares in Hugo Boss in recent months, has previously said it intended to be a “supportive shareholder”.
Earlier this year it raised its stake in Hugo Boss for the second time having increased it to 10.1% in late June, after disclosing an initial 5.1% holding earlier that month.
“This investment reflects Frasers Group’s growing relationship with Hugo Boss and belief in Hugo Boss’s long-term future,” Frasers Group said at the time.
Hugo Boss was up more than 6% in Frankfurt on the back of the speculation on Friday, valuing the company at €3.2bn.
The gain followed similar media reports last month that Bernard Arnault’s French conglomerate LVMH (MC.PA) was also looking to swoop on the brand.
Mike Ashley is currently looking to elevate his existing retail brands by selling more upmarket goods alongside his House of Fraser and Flannels chains.
It comes as retail sales jumped 9.2% last month compared with March, beating expectations, as non-essential shops reopened on 12 April.
Compared with April 2020, during the first national lockdown, sales were up 43%, according to the Office for National Statistics (ONS). Sales were also 9.9% higher than the last month of trading before COVID-19 hit.
Shoppers indulged in new clothes, including outerwear and knitwear, compared with previous shopping habits of wearing comfortable clothes and loungewear for indoors.
“The easing of lockdown has been just the excuse the Great British public needed to head out and buy a new outfit or two,” Danni Hewson, financial analyst at AJ Bell, said.
“The latest retail sales figures show the lifting of restrictions on non-essential retail has been just the tonic for ailing businesses and that the much-discussed pent up demand is real.”
Yahoo Finance has reached out to Frasers Group for comment.
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