From rivals to team mates: Mike Ashley offers Debenhams Group support

Frasers Group founder Mike Ashley has made another attempt to increase his influence over Debenhams Group, which is made up of Debenhams, Boohoo, Karen Millen, Dorothy Perkins and PLT, by offering financial support in debt refinancing. This move follows his previous involvement in the group's restructuring efforts. 

The retail tycoon has approached the group’s leadership with a formal request to discuss becoming a lender to the company, which would further solidify his position as its largest shareholder. In a letter sent via legal representatives at White & Case, Ashley has called for an urgent meeting with Debenhams’ non-executive chairman, Tim Morris, to discuss options for refinancing its outstanding debt.

The letter reads: "Frasers stands ready and able to assist Boohoo with any refinancing in order that Boohoo has a suitable and sustainable path forward."

Debenhams Group is currently in discussions to refinance £175 million in debt as it contends with falling sales and stiff market competition. In its most recent annual results, the group reported a 16% drop in revenues.

However, a spell of early summer sunshine has sent UK consumers into a seasonal shopping frenzy, delivering a short-term boost for Debenhams Group. Despite this, further concerns have been raised about Debenhams Group’s cash flow, with reports that customers are now waiting up to four weeks for refunds.

Ashley’s offer to inject fresh capital or support debt restructuring could position him advantageously if the company moves towards a broader balance sheet overhaul. As a secured creditor, Frasers would rank ahead of shareholders in any such scenario.

The news marks another escalation in the long-running rivalry between Ashley and Boohoo’s executive chairman and co-founder, Mahmud Kamani. Ashley previously attempted to acquire Debenhams before its collapse, only to see Boohoo swoop in and buy the brand out of administration in 2021.

Frasers has since steadily built a 29% stake in Boohoo since first investing two years ago and earlier this year attempted to oust Kamani, citing "terrible refinancing, lack of transparency, poor results and further supply chain allegations."

The group had also been subject to a campaign by Ashley to get himself installed as CEO. This was cut short when Boohoo appointed Dan Finley, former boss at Debenhams, which is owned by the group, in November 2024.

Ashley then tried to get a seat on the board instead, alongside restructuring expert Mike Lennon, which Debenhams Group also resisted. Frasers Group claimed in a letter that Boohoo’s opposition to Ashley and Lennon joining the board was because of fears they would "dilute" the influence of its co-founder, Mahmud Kamani.

Nonetheless, Ashley's latest move signals that he remains determined to assert greater control over Boohoo’s strategic direction.