David Richardson, the chairman of the beleaguered retailer Sports Direct International, resigned yesterday, only three months after he was brought in to help Mike Ashley, the founder, to take the company to the market.

Shares in the retailer slumped 4.6 per cent to a new low of 205p, 32 per cent below its flotation price, as the City was stunned by the latest twist in the unhappy saga of the reclusive billionaire Mr Ashley’s relationship with the public markets. The company said in a statement: “The chairman believes that he has been unable to establish a strong working relationship with the executive team and, as a result, believes that it would be in the best interests of the company and the board that he steps aside.”

Mr Richardson is understood to have had a stormy relationship with Mr Ashley and Dave Forsey, his chief executive, since agreeing to take on the chairmanship just before the flotation of Sports Direct.

He informed the board of his decision to quit on Wednesday, as it appeared increasingly unlikely that the company would meet its promise, set out in a statement in April, to hire financial advisers by the end of May.

Mr Richardson is thought to have become frustrated at the Sports Direct management’s lack of communication with the City and its nonexecutive directors. Yesterday Mr Richardson declined to comment on any of the events pertaining to his departure. However, he said: “It’s unfortunate that we got to the point that I felt it was necessary to resign. I genuinely wish the company well and hope with the appointment of advisers they will build a good relationship with the City.”

The departure of Mr Richardson, an experienced City hand and former Whitbread executive, is likely to whip up a storm of criticism around Sports Direct. Mr Ashley raised eyebrows in the City when it emerged that he had bought a personal 3 per cent stake in adidas, the German sports brand that is a supplier to his stores, without informing the board. His acquisition of a large stake in Newcastle United, the football team, has also caused concern.

Until yesterday, when Merrill Lynch and Credit Suisse were announced as joint brokers, the company had no formal financial advisers or investor relations team, having dismissed Tulchan, the financial public relations firm, soon after flotation. The company said yesterday that it had appointed Related Links to handle investor relations and Financial Dynamics for public relations.

Shares dived 9 per cent in April after a trading statement was viewed as a “veiled profit warning” by analysts, who complained that they had been unable to speak to anyone at the company. Shares have also been hit after analysts from Merrill Lynch, Credit Suisse and Citigroup, the three banks that backed Sports Direct’s flotation, downgraded their profits estimates from research circulated at the float.

Sports Direct said that Simon Bentley, a nonexecutive director and the former chairman of Blacks Leisure, had agreed to become acting chairman. Blackwood, the headhunter, has been instructed to look for a replacement for Mr Richardson. The firm is working to find another nonexecutive to join the board.

Mike Ashley in his own words

—December: The reclusive billionaire tells journalists that he is a “private man running a private business" who had “no desire for a public profile” in his first interview. However, he adds that he is considering a public listing for the company because “our mission is to be the most profitable sports retailer in the world”

—December: Releasing to the media the first picture of him since the 1970s, he says: “When you see the picture you'll understand why I didn't want my photograph taken”

—February: Mr Ashley formally announces flotation: “It is a very proud moment for me and all the people who helped get us here.” He adds: “Everyone is more comfortable dealing with a public company”

—April: “I think it was probably not correct to not have an IR [investor relations] firm in place before the float, if I'm honest. If I did this again I would have them on board many months before”

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