Sports Direct Suffers AGM Investor Rebellion

Sports Direct's AGM has witnessed a rebellion by major shareholders, despite its promises of action to placate anger over working practices and corporate governance.

Confirmation that the company had failed to do enough for some investors came initially from Standard Life Investments - its second-largest shareholder.

It said it voted against Sports Direct's pay report and the reappointment of all non-executive directors on the board.

L&G Investments is also understood to have done the same at the meeting, which was held at Sports Direct's Shirebrook HQ in Derbyshire.

The results of key votes were expected later on Wednesday afternoon - with founder Mike Ashley, who holds 55% of Sports Direct, fighting off criticism of reforms to working practices announced by the company of Tuesday.

There was evidence of frayed tempers at the AGM when he clashed with Unite - claiming it was trying to bash him as he tried to turn workers' conditions around.

He told the union: "It's your fault we're in this mess" before taking journalists and investors on a tour of the site - including its controversial warehouse where he was left visibly embarrassed at security.

Mr Ashley was forced to empty his pockets - revealing a wad of £50 notes.

In the hours before the meeting began, it emerged that the board had turned down an offer by its chairman to quit over the company's problems.

The shareholder gathering was later told that Keith Hellawell, perhaps best-known as a former government drugs' tsar and chief constable of West Yorkshire, would quit next year if he failed to win significant support from investors.

His position was expected to come under pressure in the votes.

Sports Direct's actions to appease disgruntled shareholders follow a 55% slump in its share price over the last year.

In a trading update released ahead of the showdown shareholder meeting, Sports Direct warned that underlying profits for the full year were now likely to come in up to £80m lower than last year.

Its shares were 9% lower on the FTSE 250 in the wake of the statement.

Euan Stirling, head of stewardship and environmental, social and governance investment at Standard Life Investments, told the AGM that structural change was now required - with Mr Ashley taking on a greater role.

"In order to arrive at the correct structural conclusions, we believe that a full and independent review of governance at the company is required, along with a commitment to publish and act on the review's conclusions and recommendations in the next twelve months," he said.