Mike Ashley's Sports Direct dumped out of top 100 UK firms

High street chain Sports Direct was dumped out of the UK's top 100 firms, while supermarket Morrisons rejoins the top flight, after the latest review of the country's largest public companies.

Wednesday, 2nd March 2016, 7:07 pm
Updated Wednesday, 2nd March 2016, 7:16 pm
Sports Direct

The FTSE Russell group, which runs the prestigious FTSE 100 Index, confirmed the changes after its EMEA committee met on Wednesday evening.

Recently merged bookmaker Paddy Power Betfair, healthcare specialist Mediclinic International and publishing and events firm Informa also took their places among the country's biggest firms.

Conversely, fund manager Aberdeen Asset Management, drugs company Hikma Pharmaceuticals and medical-devices-to-airport-security firm Smiths Group fell into the FTSE 250 to make way for the changes at the top.

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The FTSE Russell group said its decisions were based primarily on the final market capitalisations of the firms concerned at the end of business on Tuesday, and will take effect at the start of stock market trading on March 21.

Sports Direct, controlled by Newcastle United owner Mike Ashley, has seen its shares tumble some 50% over the last 12 months as the firm continues to be mired in controversy.

Investors are unhappy at the corporate governance at the business, where Mr Ashley owns 55% of the group.

There are increasing reports that Mr Ashley may take the business back into private hands after joining the top flight just three years ago.

It also came under fire in December for the harsh treatment of its workers, following allegations in The Guardian newspaper claiming it forces compulsory unpaid searches taking around 15 minutes on staff as they leave, while also docking wages for clocking in just one minute late.

The retailer also issued a profit warning in January because of fierce high street competition and bad weather in the run-up to Christmas.

Morrisons returns to the FTSE 100 Index, after being relegated just three months ago.

Under chief executive David Potts, the group has recently signed a deal with US online giant Amazon to supply fresh food to its customers, closed unprofitable supermarkets, and sold off its non-core convenience outlets.

Irish bookmaker Paddy Power, which completed a £5 billion merger with online rival Betfair on February 2, joins the top flight.

By contrast, Aberdeen Asset Management has seen its stock fall some 45% over the last year, as a result of its exposure to turmoil in emerging markets, and leaves the FTSE 100 Index.