Mike Ashley, the billionaire businessman, took a major step towards assuming control of Newcastle today when the chairman Freddy Shepherd agreed to sell his shares to the tycoon for more than £37 million.

The latest acquisition will give Ashley a stake of almost 70 per cent in the club and edge him to within touching distance of the 75 per cent threshold at which he would effectively assume control and make a £133.1m total buy-out almost inevitable.

St James Holdings Limited (SJHL), the company set up by the Sports Direct international founder to stage a takeover bid, announced the development to the Stock Exchange as it opened for business this morning.

A statement said: "SJHL has received irrevocable undertakings from Shepherd Offshore Limited, a company connected with William Frederick Shepherd and Bruce Stewart Shepherd, and Timothy Revill, the independent non-executive director of Newcastle United, to accept the offer in respect of a total of 37,288,959 Newcastle United shares representing, in aggregate, approximately 28 per cent of the existing issued share capital of Newcastle United."

In addition, the board of Newcastle plc has recommended the remaining shareholders accept SJHL's offer of 101p per share as Ashley attempts to push through his takeover.

Insiders at St James' Park have been keen in recent days to promote the idea of Shepherd remaining in the role of chairman under the new regime, with the prospective owner taking a back seat.

There has been no confirmation on that yet, although Shepherd, who had fought off previous approaches from the Belgravia Group and the Polygon-backed St James' Park Group, is satisfied that Ashley has the club's interests at heart.

He said in a statement issued this morning: "The time since Newcastle's flotation in 1997 has seen a radical transformation in the club and its fortunes, with the club now being one of the 20 wealthiest clubs in Europe with one of the finest stadiums in European football, a Premier League participant and a regular participant in European Uefa competitions with a fantastic fan base.

"The offer from SJHL is at a level which fully reflects both the performance of Newcastle and its prospects and ambitions for the future.

"The board believes that SJHL and Mike Ashley will be excellent custodians of Newcastle United's heritage and will provide the best possible opportunity for the club to flourish in the future, to the benefit of the company and its fans."