MIKE Ashley’s retail empire has increased its stake in Mulberry to own more than a third of the luxury handbag maker, in a move worth more than £6 million.

Mulberry has its headquarters in Chilcompton, Somerset, as well as a factory outlet store at Kilver Court, Shepton Mallet.

Last month it revealed that its losses plunged nearly tenfold to £47.9 million in the year to March 31, before feeling the full impact of Covid-19.

In June, it cut its workforce of 1,500 by a quarter after demand for its luxury products was hammered by the pandemic.

Frasers Group, which has Newcastle United owner Ashley as its chief executive and runs Sports Direct and House of Fraser, said it had bought 4.3 million shares at 150p each, to increase its ownership Mulberry to 36.8 per cent.

It purchased the shares from Icelandic bank Kaupthing, which owned fashion brands Oasis and Warehouse before they collapsed into administration earlier this year.

Frasers Group first took a stake in the Somerset-based company in February, before it more than doubled its holding to around 29 per cent earlier this month.

Under Takeover Panel rules, any group which takes a stake of more than 30 per cent in a business is typically required to make an offer to buy the whole business.

However, the takeover authorities said today (Thursday) that Frasers Group does not have to place a bid, as another investor already owns a majority stake in Mulberry.

Challice, the investment vehicle for Singapore’s Ong Family, owns around 56 per cent of the business.

Nevertheless, Frasers still has the right to make an offer to buy Mulberry outright and must now confirm whether it intends to make a takeover bid by December 17, according to new filings to the London Stock Exchange.

Frasers also acquired a stake in German luxury brand Hugo Boss this year, as it pushes forward with efforts to shift its image to be more upmarket.