Businessman John Andrew has spoken of his shock after being ousted from the multi-million pound company he founded 24 years ago.
Mr Andrew, 48, chairman of Huddersfield-based Direct Golf, was forced out in a boardroom coup.
Sports Direct, which took a 25% stake in the company last year, bought the company out of administration, safeguarding 162 jobs.
Mr Andrew, a former PGA golf professional, lost his fight for control with giant rival Sports Direct, run by billionaire retail magnate Mike Ashley, the controversial owner of Premier League football club Newcastle United.
Direct Golf UK and its parent company, Powerhouse Golf, were put into administration on October 16 after the discovery of alleged accounting irregularities which effectively rendered the business insolvent.
Mr Andrew told the Examiner how he tried to save the business and pledged a personal investment of £1.8 million.
Sports Direct refused to back his restructuring plan and Sports Direct removed all three directors – Mr Andrew, managing director Neil Bell and procurement director Rob Andrew – and issued injunctions against them, banning them from the company. Sports Direct bought the business out of administration, leaving Mr Andrew frozen out.
“It’s gut wrenching and I need time to come to terms with it,” said Mr Andrew. “This is a company I started 24 years ago and one I ran without a partner or another shareholder until 12 months ago.
“I’m not to blame for any of this and I’ve looked back at what’s happened and I don’t know what else I could have done.”
Sports Direct bought a stake in Powerhouse Golf last year investing £2.25 million. The company, which had 20 stores including the original one in Leeds Road, Huddersfield, invested in its shops and product lines and sales increased by 25%, said Mr Andrew.
But problems came to light after an in-depth financial audit, which set alarm bells ringing.
Mr Andrew said the business had been on an “absolute high” and alleged errors in the accounts had come out of the blue.
“Neither me nor the other two directors knew anything about this,” he said. “We gave Sports Direct complete ‘under the bonnet access’ to the business and served a notice of intention of administration.
“I was ready to invest personally to save the business and Sports Direct sent letters of support but never came through.”
Mr Andrew was working with insolvency firm Begbies Traynor but another firm, Duff & Phelps, was appointed administrator and a deal was struck with Sports Direct.
It is understood problems came to light after Powerhouse Golf reported a 76% dive in profits and sales slid 13% to £21.4m in the year to the end of September 2014.
Administrator Philip Duffy said: “The company had come under “serious cash flow pressure as a result of significant accounting issues that will require further detailed investigations by the administrators.
“As a result the business was in danger of ceasing to trade and therefore a sale of the business had to be concluded as quickly as possible. A number of offers were received. The sale means that all 162 jobs have been saved.”
It is understood large amounts are owed to HM Revenue & Customs, landlords and suppliers.
The Examiner reported three weeks ago how Sports Direct changed the locks on the firm’s HQ in Bankwell Road, Milnsbridge, premises owned personally by Mr Andrew.
It is understood the 25 or so head office staff have been issued with redundancy notices but offered jobs with the new company.
It is thought the head office jobs are being moved to Shirebrook, near Mansfield.
Direct Golf — a potted history
John Andrew fought desperately to save Direct Golf in recent years.
He built the business from nothing into a company employing 250 people with an annual turnover of £25 million.
Mr Andrew, 48, came to Huddersfield aged 17 as assistant professional at Fixby Golf Club. He moved to Longley Park and was a golf professional at Crosland Heath when he spotted an opportunity to launch his own business.
He set up Direct Golf in 1991, opening a shop in Leeds Road, Huddersfield. Taking over seven Nevada Bob’s sites he grew the business into Europe’s second largest golf retailer, owning 100% of the business until he sold a 25% stake to Sports Direct last year for a nominal £1.
In recent years a drop in sales was blamed on poor weather and Mr Andrew was forced to invest his own money.
In April 2013 Mr Andrew announced a £3.5m funding deal with the Royal Bank of Scotland.
At the time he said: “A poor summer in 2012 increased this pressure on our cash flow, which meant I had to personally inject over £500,000 into the business, although I am sure many small and medium-sized enterprises did the same.
“As a result, we sought funding to allow us some room to breathe.”
In February last year the firm consulted staff over redundancies at its distribution warehouse.
At that point the firm handled its own distribution from a warehouse in Milnsbridge and Mr Andrew out-sourced to a Wetherby-based company, slashing the wage bill by £1 million a year.
The firm shed 26 jobs and some employees had worked for Mr Andrew for 10 years.
He hired a human resources consultant to help staff with job applications and personally phoned business contacts and suppliers.
He even paid for an advert in the Examiner saying: “Staff for hire.”
Mr Andrew sold his 25% stake in Sports Direct for £1 but as part of the deal Sports Direct invested £2.25m in store revamps and stock.
Last year Mr Andrew also branched out into bikes, hoping to cash in on the cycling boom.
He opened Bike-Shed.com alongside Direct Golf in Leeds Road.
Mr Andrew, who lives in Shepley, has other business and property interests and is set to take some time out before deciding on his next move.“It’s almost like a bereavement,” he said.