Serial investor Baugur has taken a stake in beleaguered retailer Sports Direct.

The Icelandic group, which owns large swathes of the UK high street including toy retailer Hamleys, department store chain House of Fraser and fashion group Mosaic, has acquired a 1 per cent stake in the sports firm.

Sports Direct has been the subject of controversy since its float in February and founder and deputy executive chairman Mike Ashley rapidly fell out of favour with the City.

Since floating at 300p per share, the retailer has issued a profit warning and suffered the loss of its non-executive chairman David Richardson.

According to a report in The Daily Telegraph, Baugur has acquired the stake in the retailer as a “punt”, rather than a strategic investment.

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