Yahoo Finance JD Sports hits back at covert video of car park ‘chat’
JD Sports has hit back at the “highly irregular and potentially illegal” filming of a meeting between its chief executive, Peter Cowgill, and the head of its smaller rival Footasylum as it seeks to fend off an inquiry by the competition watchdog.
The retailer insisted that Mr Cowgill and Barry Bown did not breach an order from regulators when they were recorded talking in a car park near Bury in Greater Manchester.
Competition and Markets Authority officials are examining the footage.
JD Sports bought Footasylum three years ago in a £90m deal, and was told by the CMA to keep it separate pending an investigation into whether the deal would push up prices for consumers. It has since been ordered to sell the company.
The FTSE 100 sportswear business denied wrongdoing, saying the two executives have known each other for 25 years and it is not unusual for them to meet. It added that meetings were allowed to take place to prevent Footasylum staff, including Mr Bown, from leaving the business.
JD Sports said: “Any suggestions with regard to corporate governance breaches are totally refuted.”
The video recording, which was first made public by The Sunday Times, has sparked a fresh investigation by the competition regulator.
Mr Bown, executive chairman at Footasylum, was chief executive of JD Sports for almost 15 years after initially joining in 1983 as a store manager. JD Sports is understood to believe that the meeting was filmed by a competitor keen to thwart its deal and described it as “highly irregular and potentially illegal covert surveillance undertaken by a third party for their own interests”.
Sources close to JD Sports said it was seeking to establish who was responsible and was keen to take the culprit to court. The CMA said: “These rules are put in place to protect consumers and other businesses operating in that market as we investigate a merger.
“We take compliance very seriously and thoroughly investigate any potential breaches. Where there is clear evidence that a breach has occurred, we do not hesitate to take action.”
The watchdog declined to say where it obtained the footage from, but confirmed it was aware of the meeting and had seen the video.
One of the main opponents of the Footasylum takeover was Sports Direct, owned by Mike Ashley’s business, Frasers Group.
