Boy who won spurs in street market turns to football

Alan Sugar is set to quit Amstrad the company he created 28 years ago.

Alan Sugar, the former East End barrow boy who became one the City's most audacious and wealthiest wheeler-dealers, is set to quit Amstrad, the consumer electronics group that he founded 28 years ago.

The man who made his millions flogging cheap and cheerful hi-fi systems, cut-price personal computers and aesthetically challenged satellite dishes, is on the verge of selling his creation to Psion, the firm best known for its computerised personal organiser, for at least pounds 240m. The deal would net him about pounds 80m.

Mr Sugar apparently wants to devote more time to Tottenham Hotspur, the north London football club he controls, and to prepare for a High Court battle with England coach Terry Venables in the autumn.

Last night sources close to Mr Sugar sought to play down the significance of the proposed sale. "He's not riding off into the sunset," an adviser insisted. "He'll continue his involvement with Amstrad in a deal-making capacity."

But Mr Sugar will not even have a seat on the board.

Amstrad was always his company - the company's name is an acronym of Alan Michael Sugar Trading. Having left school at 16, he began his business life selling car aerials from the back of a van in his native Hackney, east London.

From the outset, he followed his highly developed instinct to spot a gap in the market to make a fast buck. Mr Sugar once said: "We're interested in mass-merchandising anything. If there was a market in mass-produced nuclear weapons we'd market them too."

Amstrad was floated on the stock market in 1980 and quickly built up a reputation for exploiting the potential for cheap but professional home computers and good-value audio and video equipment. To keep costs down, production was contracted out to the Far East.

At first the formula won him many City admirers and by 1988 he was worth an estimated pounds 600m. But by the Nineties, recession and an influx of new competitors had driven computer prices down, leaving Amstrad horribly exposed.

The company made its first loss in the second half of 1991 as rivals such as IBM started to encroach on the market. Amstrad continued to struggle, losing money in the three years to 1994, though a decision to concentrate on mobile phones and selling computers direct to the public helped make a small profit last year.

Analysts suggested Mr Sugar's new-found enthusiasm for football was another reason for Amstrad's travails. Five years ago he teamed up with Terry Venables to buy Tottenham Hotspur. While that partnership ended in acrimony, Mr Sugar's interest in the business potential of football has grown.

Perhaps more than any other football club chairman, he realises the potential goldmine in pay-per-view television. He was instrumental in securing an exclusive pounds 670m deal with satellite broadcaster BSkyB to transmit live Premier League football into the next century.

The deal quadruples the television income of clubs like Spurs to about pounds 10m a year. But according to a survey by market research group Harris, when digital television is introduced to Britain within two years Spurs could earn up pounds 121m a year from viewers paying pounds 10 a game.

But perhaps the most immediate explanation for Mr Sugar's decision to quit Amstrad is litigation. He is involved in a long-running legal battle with Terry Venables, and is bringing a High Court hearing in October claiming he was defamed in Venables' autobiography.

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Comment, page 17.

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