Investors piled into Mike Ashleys Frasers Group after it kicked off a surprise share buyback scheme.
The Sports Direct and House of Fraser owner will spend up to 60million purchasing its own stock between now and July despite warning less than a month ago that it would suffer a 200million hit from the pandemic. It will start the spree next Tuesday, buying a maximum 10m shares.
The retail conglomerate refused to explain beyond saying it was to reduce the share capital of the company. Businesses usually buy shares and hold them in reserve to reduce the number available to the public.
This tends to push up the value of the stock but it is also a way that firms return cash to investors other than paying dividends.
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Although the announcement was welcomed by the City, with Frasers climbing to the top of the FTSE 250 leaderboard, rising 5.7 per cent, or 29.5p, to 545p, it also raised eyebrows.