Sports Direct's founder Mike Ashley has missed out on a huge further windfall from the flotation of the discount sportswear chain because its shares failed to climb after it was listed on the stock exchange last month.

The sports group generated £930m for Mr Ashley when it floated and he could have got up to £140m more if the shares had risen significantly in the after market. But investor appetite has cooled amid growing concerns over the group's boardroom strength and against a volatile stock market. The shares have lost almost 10% since the flotation and have underperformed both their sector and the wider London market.

After the float, Sports Direct's bankers at Merrill Lynch had an over-allotment, or "greenshoe", option for 46.4m shares. As part of a market stabilisation mechanism, they could have exercised the option and sold the extra shares in the event that they had risen significantly above the flotation price of 300p. But a notice to the stock exchange yesterday announced Merrill was not exercising the option and that it was returning the shares to Mr Ashley.

The fall in Sports Direct's shares is in the wake of City concerns about the structure and weakness of the board at the chain.

Questions have centred on the finance director, Bob Mellors, and whether he is keeping adequate watch on the firm's finances. Mr Mellors, who has links with Sports Direct that go back to when Mr Ashley started the business in 1982, has been absent from meetings with investors.

The low profile of the finance director in such a fast-growing and aggressive company is of concern to investors and their worries have been exacerbated by the fact that Sports Direct recently sacked its financial public relations advisers. The list of investors has so far not been distributed as widely as is usual and is only available from the company secretary.

The retailer's relationship with the City has also been strained this week by news that Mr Ashley dug into his personal wealth to buy just over 3% of the German sports goods manufacturer Adidas - seen as a potential conflict of interest with his role at Sports Direct. Mr Ashley, who has kept control of the business with a stake worth more than £1bn, has the unusual title of executive deputy chairman.

Sports Direct declined to comment on the return of 46m shares to Mr Ashley.

Last night the shares closed down 1.5p, or 0.6%, at 272p - well below its 300p flotation price.