Cumbria retail tycoon Philip Day has lost out to controversial counterpart Mike Ashley in the race to buy clothing brand Jack Wills.

Mr Ashley, who had been widely tipped to win the bidding war, snapped up the struggling company in a pre-pack administration deal.

Advisers at KPMG said Jack Wills had been put into administration on Monday before it was immediately sold to Mr Ashley’s Sports Direct for £12.75 million.

The sale includes all 100 UK and Ireland stores and stock, as well as a distribution centre, along with all employees.

It is the second time Mr Ashley has beaten Mr Day in a deal for a struggling business. Almost a year ago he won the race to buy House of Fraser in another pre-pack administration deal.

Mr Day wanted to keep Jack Wills out of administration in a deal that would have seen his Edinburgh Woollen Mill Group buy the company's debt and provide a £12 million working capital fund to cover the chain's near-term costs.

He is also understood to have committed to not restructure the business in the first month of ownership.

Speculation is rife that under Mr Ashley, Jack Wills will now go through a significant restructure, including potential store closures.

Jack Wills will come under a new division established at Sports Direct which will focus solely on buying and building fashion and sports brands, and report to Michael Murray in his role as head of elevation.

Mr Murray said: “Jack Wills has made a name for itself carving out a unique place in the minds of consumers since its launch and has today grown into one of the most recognised British fashion brands. Having taken a personal role in driving the decision to bid for this business, I am absolutely thrilled that Sports Direct was successful.

“Jack Wills will continue to operate as a separate company with its own leadership team. Our role will be to support the business and help elevate the brand and help restore it to its former glory."

Directors are considering options for the international business, which includes stores in Hong Kong, Singapore and the USA.

Jack Wills was put up for sale earlier this year by its private equity owner Bluegem Capital, after refusing to inject further money into a company that reported an operating loss of £14.23m for the year ending January 2018.

Suzanne Harlow, chief executive of Jack Wills, said: "For the past year, we have been focused on improving the Jack Wills proposition and the group's financial performance.

"Despite significant progress, the challenging trading environment led us to conclude that the company's long-term future would be best served as part of a larger group and Sports Direct will enable us to do this."

EWM Group declined to comment on the Jack Wills deal.