Goals Soccer Centres: Sports Direct says ‘skulduggery’ wiped out shareholders
Retailer Sports Direct has today blasted the management of Goals Soccer Centres after the five-a-side football firm delisted from Aim after an accounting scandal.
Goals suspended shares in March after saying its financial results contained a misdeclaration of VAT, leaving a black hole in its accounts of more than £12m.
Read more: Goals Soccer Centres warns HMRC black hole could be higher than £12m
The company has pointed the finger at former executives, while the Financial Conduct Authority has reportedly opened a probe into fraud at the firm.
Sports Direct, which is a shareholder in the business and yesterday ruled out a rescue offer, today slammed the management of the struggling business.
The retailer said that press statements attributed to a spokesperson for Goals which said the company had provided Sports Direct with all available information and had not frustrated a possible offer, were untrue.
Sports Direct said: “Goals and its board did not truly engage with an offer process; access and co-operation was limited and fitful.”
“Yet again, the independent shareholders of a UK listed company get wiped out through the skulduggery of others; as these constant corporate failures show, the current rules and regulations do not do enough to protect independent shareholders or to prevent fiscal irresponsibility,” billionaire Mike Ashley’s firm added.
Goals declined to comment.
Read more: Mike Ashley kicks off £4m takeover for Goals Soccer Centres
Ashley’s firm added: “Given the issues within the Goals business, Sports Direct believes that it would be convenient for those concerned if Goals, and its corporate history, disappeared as a result of the AMA [accelerated mergers and acquisition] process.”
Sports Direct said it doubted Goals’ claim that the accounting scandal at the firm could be the work of only one individual.
“Sports Direct considers the Goals board members it was dealing with to be intelligent, and anyone with any common sense could tell it could not be only the result of one person’s behaviour given the relative size and timeframe over which what would appear to be considerably more than ‘inappropriate actions’ took place.”
Sports Direct said “the behaviour of the Goals board, and its apparent failure to spot and deal with the issues, amounts to incredible incompetence and ignorance, wilful or otherwise, at the very least and potentially far worse”.
It called for a full investigation into Goals and said it hoped that any eventual purchaser of the business is not connected to its current management.
Read more: Sports Direct is still searching for an auditor
Sports Direct previously had its 30 per cent equity stake in Debenhams wiped out after its lenders took control after a restructuring.
“This is another example of Ashley apparently being thwarted in his takeover ambitions despite being the largest shareholder,” said AJ Bell investment director Russ Mould, “and the company in his crosshairs apparently being in an extremely weak bargaining position.”
“Ashley may be proving to be his own worst enemy, perhaps proving that you catch more flies with honey than you do with vinegar,” Mould added.
“It also brings into question a seemingly scattergun approach to buying assets in the retail and sports space.”