Mike Ashley’s Frasers Group, which owns Sports Direct, has snapped up the assets of Dave Whelan Sports from administration for £37 million.

The sports retailer has bought up “certain of the assets relating to DW’s gym and fitness business, including certain stock but excluding the DW business names and intellectual property”, it said today.

It will pay out up to £6.9 million more “contingent upon the number of leasehold interests eventually acquired”.

DW collapsed into administration earlier this month, putting 1700 jobs at risk.

Frasers last week warned that the High Street is “in ruins” and that its House of Fraser chain would be forced to close stores and cut jobs without a shake-up of the business rates system.

Frasers said: “The transaction compliments the existing gym and fitness club portfolio within the company’s group and is consistent with the group’s elevation strategy. Frasers Group looks forward to elevating the gym and fitness assets acquired pursuant to the Transaction under the group’s existing iconic Everlast brand, and is also pleased to have saved a number of jobs.”

In its last accounts, for the year to March 31, DW had gross assets of £194,976,000 and made a loss of £20,085,000.

DW Sports, which was founded by former Wigan Athletic owner Dave Whelan, operated 73 gyms and 75 retail sites across the UK but announced plans to shut 25 of its stores last month.

DW’s sister brand Fitness First, which has 43 gyms, is not affected by the administration and sale.

The business has been struggling with non-essential stores and gyms forced to close during the Covid-19 lockdown. On entering administration, chief executive Martin Long said: “As a consequence of Covid-19, we found ourselves in a position where we were mandated by Government to close down both our retail store portfolio and our gym chain in its entirety for a protracted period, leaving us with a high fixed-cost base and zero income.”

Ashley has built up an extensive portfolio of brands within Frasers including Flannels, House of Fraser, Evans Cycles, Game and Sofa.com.