Nike had an offer of £295 million for the brand recommended by the board last week. Its offer was made through a scheme of arrangement and needs to garner the support of shareholders representing 75% of the equity to succeed.
However Sports Direct's new shareholding means it could effectively block the takeover or force Nike into paying more for the business. 29.9% is the most it can hold without launching a counter offer for Umbro, but Sports Direct founder Mike Ashley could still enter a takeover battle.
Nike's proposed takeover of Umbro has already won crucial support of the Football Association - Umbro has the contract to produce football shirts for the England team. However Sports Direct rival JJB Sports also built a 10.12% stake in the company last month to give it a say in any negotiations and it is unclear whether JJB will support Nike's offer.