Mike Ashley has ramped up his efforts to gain control of Debenhams as the department store chain puts in motion plans to secure \u00a3200m in new funding and has made an offer to buy its Danish business Magasin du Nord.<\/p>\n
Debenhams has also announced it will pursue a restructuring plan in a move which could wipe out existing shareholders,<\/strong> including the Sports Direct founder.<\/p>\n However, Following the announcement this morning, Sports Direct issued a statement saying it had offered to buy Magasin du Nord.<\/strong><\/p>\n The terms of the deal would involve installing Ashley as chief executive <\/strong>of Debenhams, to assist in its restructuring process.<\/p>\n It would also allow Debenhams to buy back the business <\/strong>at the same price in 12 months, and could even sell it to another bidder at a higher price.<\/p>\n \u201cSport Direct believes its proposal would provide additional management and first-class leadership<\/strong> to Debenhams through this challenging period of restructuring, together with additional funding,\u201d the company said.<\/p>\n Debenhams is understood to consider the offer to be too low.<\/p>\n Sports Direct said in its statement that it had invited further details on valuation if the company believes the business to be worth more.<\/p>\n Debenhams on Friday launched a consent solicitation for its lenders<\/strong> in a bid to secure up to \u00a3200m, a higher amount than previously thought.<\/p>\n If successful, the retailer will also embark on a restructuring in an effort to \u201csecure the future of the business\u201d.<\/p>\n Options are thought to include a debt-for-equity swap and a pre-pack administration<\/strong>, with the latter expected to be more likely as it does not require shareholder approval.<\/p>\n Both options would result in existing investors, including Sports Direct, losing their holdings in the company.<\/p>\n A Company Voluntary Arrangement (CVA) to speed up store closures and rent reductions could also be part of the plans, or come at a later stage.<\/p>\n Shares in Debenhams dropped as much as 91%<\/strong> in early trading on Friday, hitting a low of 0.25p. By mid-morning shares were changing hands for just under 2p.<\/p>\n Ashley, who owns just under 30% of Debenhams through Sports Direct, has been trying to oust the high street chain\u2019s board and install himself in their place.<\/p>\n On Thursday, he reiterated his call for a shareholder vote on the proposal, which would see all directors except finance boss Rachel Osborne kicked out.<\/strong><\/p>\n He already ousted former chairman Sir Ian Cheshire from the company in January by teaming up with fellow shareholder Landmark to vote against his re-election.<\/p>\n Chief executive Sergio Bucher was also removed as a director but has remained in his post for the time being.<\/p>\n Ashley had also offered Debenhams a loan, which it said would be considered.<\/p>\n Debenhams said last week that it was in talks with lenders to secure a new loan, part of which will pay down a bridging loan<\/strong> that it announced in February.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" […]<\/p>\n","protected":false},"author":42,"featured_media":133588,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[10585,6,10494],"tags":[3514,14183,11421,11405,10836],"acf":[],"yoast_head":"\n