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Mike Ashley’s retail giant Frasers Group is mulling a takeover bid for luxury fashion firm Mulberry after snapping up another tranche of shares.

Two weeks ago the Newcastle United owner’s company doubled its stake in the designer bag and clothing company from 12.5% to 29.7%.

The group, which has the likes of Sports Direct, House of Fraser, Evans Cycles and Flannels in its portfolio, first bought its 12.5% stake in Mulberry in February, saying the purchase was part of a “key strategic priority” to elevate Frasers Group’s retail proposition and build “stronger relationships with premium third-party brands”.

Now the firm has announced the purchase of a further 7.12% stake in Bath-based Mulberry, after splashing out £6.5m on the acquisition of more than four million shares from Icelandic company Kaupthing ehf, paying £1.50 per share.

The acquisition means Frasers Group now holds interests in more than 22m ordinary shares and a total of 36.82% of Mulberry’s share capital, as well as voting rights and contracts for difference relating to almost 27.5m ordinary shares.

Depite having more than 30% stake in the firm, Frasers Group has received a dispensation from the Panel on Takeovers and Mergers that it does not have to make a mandatory cash offer to other Mulberry shareholders as the major shareholder is Challice Ltd with 56%.

But it does have a right to voluntarily make an offer and in a stock market note to shareholders, Frasers said it has a month to decide on whether to make a move for the company. This deadline can be extended with the consent of the Takeover Panel.

The note, issued by company secretary Tom Piper, said: “Frasers Group is, however, still reserving its right to make a voluntary offer for the company.