Mike Ashley bags stake in luxury brand Mulberry Group

Mike Ashley's Frasers Group has swooped to buy a 12.5% stake in struggling luxury brand Mulberry.

The retail tycoon's company, which changed its name from Sports Direct International late last year as part of a focus on going more upmarket, disclosed the move just after financial markets had closed for the day.

Its statement said: "A key strategic priority for Frasers Group is the elevation of our retail proposition and building stronger relationships with premium third party brands.

Frasers Group looks forward to working more closely with Mulberry for the benefit of shareholders of both companies."

Mulberry is a producer of goods and a retailer - both in-store and online. It is best known for its leather products, including handbags which can cost more than £1,000 apiece.

Frasers described the company as a "global luxury brand with a rich British heritage" but it offered no motive for the investment and did not divulge the price paid.

Based on Mulberry's current market value the stake is worth just over £19m.

The transaction meant Frasers, which includes the Flannels luxury fashion operation, has become Mulberry's third-largest investor.

Mulberry was yet to comment.

The investment marks Mr Ashley's latest move beyond sportswear. High profile additions to his empire have included House of Fraser, Jack Wills and Evans Cycles - all purchased out of administration.

Mulberry already sells through House of Fraser.

It has been among a clutch of brands to report tough trading amid weak consumer demand.

Its most recent financial figures showed pre-tax losses of almost £10m in the six months to September.