Mike Ashley unveils plan to exit Sports Direct and take over the running of Debenhams
Sports Direct owner Mike Ashley has announced a plan which, if successful, would see him installed as a director at Debenhams and result in the removal of all existing directors from the board, apart from its recently installed CFO Rachel Osborne.
Ashley, whose Sports Direct owns a near 30% stake in the ailing department store, has requisitioned a general meeting of Debenhams plc to forward his proposal. Should he be appointed at Debenhams Ashley said he would step down from his current roles as a director and chief executive of Sports Direct and focus on Debenhams.
Under the plans Ashley would be replaced as acting chief executive by Chris Wootton, currently Sports Direct's deputy chief financial officer.
In a stock market statement the company said: "Sports Direct wishes to reassure its shareholders that, if Mr Ashley were to be appointed to the board of Debenhams and step down from his roles at Sports Direct, Sports Direct and Mr Ashley have every confidence that acting chief executive Mr Wootton and the other members of Sports Direct's board and management team have the necessary expertise to continue to successfully run the Sports Direct business."
Ashley had been expected to make a swoop on Debenhams at some stage and he is said to have long harboured a desire to see if it could be merged with rival department store chain House of Fraser, which he bought out of administration last August.
Debenhams has issued a string of profits warnings in recent months, the latest which was made on Tuesday in which it said that like-for-like sales had fallen by 5.3% in the 26 weeks to 2 March 2019, and that its profits fell short of the expectations set out on 10 January.
As a prelude to his demand to be installed on the board and using his power as a major shareholder, Ashley voted down the re-appointment for former chairman Sir Ian Cheshire in January forcing him to stand down. At the same time CEO Sergio Bucher was denied reappointment to the board but has remained in post, reporting to the board.
