Mike Ashley has failed in a bid to trigger an investigation into the financial affairs of struggling department store chain Debenhams.
Lawyers representing the Ashley’s Frasers Group, which owned nearly a third of Debenhams’ shares, asked a judge to appoint a “provisional liquidator” who could begin inquiries.
But Judge Mark Mullen, who considered the application at a remote hearing in the specialist Insolvency and Companies Court on Wednesday, refused.
The judge said neither other Debenhams’ shareholders nor creditors were aware of the application. He indicated that he would reconsider the issue at another hearing in the near future, but said he wanted the application to be “known about”.
Debenhams is in administration for the second time in a period of about 12 months. Its investors appointed administrators in what it described as a “light touch” administration in early April.
Debenhams, which had been listed, was previously placed into administration in April 2019 when it was bought by a consortium of its investors, called Celine Jersey Topco, in a pre-pack deal which took it private.
Ashley had previously attempted to wrest control of Debenhams himself offering to buy the business or proffering loans on the condition he be appointed CEO but he was continually rebuffed.
Judge Mullen added that Frasers Group had issued a winding up petition against Debenhams but no decision has yet been made about whether that winding up petition should be granted.
The judge said the appointment of any “provisional liquidator” was not urgent. He said there was no evidence to suggest that Debenhams’ assets or documents needed to be secured because they were in any danger.
A barrister representing Frasers Group had argued that a provisional liquidator should be appointed. Barry Isaacs QC told the judge how Debenhams had last year borrowed around £40 million – but Frasers Group loan offers had been rebuffed.
The judge said Frasers Group, which was previously known as Sports Direct International, had identified those “bridging facilities” as “suspicious”.
Debenhams is currently preparing for the re-opening of its stores, which will be permitted from 15 April, having secured new lease agreements on around 120 of 142 locations.