Deadline set for Sports Direct
Ashley ordered to ‘put up or shut up’ over Debenhams
Debenhams: wants clarification from Mike Ashley
Mike Ashley’s Sports Direct has been issued with a ‘put up or shut up’ order from Debenhams after he indicated that he is looking at buying the department store business.
Sports Direct is already Debenhams’ largest shareholder with a near-30% stake but Mr Ashley was thwarted in his attempt to gain a seat on the board and replace nearly all of the existing directors.
Debenhams, which has issued a string of profit warnings and has lost 90% of its market value in the last year, is pursuing its own refinancing plan, but it warned on Friday that existing shareholders could be wiped out.
Debenhams said this morning it had noted Sports Direct’s interest but did not believe a takeover would address its immediate funding requirement.
In a statement to the stock market it said the company will continue with its plan to obtain the funding required, as outlined in its statement on 22 March.
“Any proposal from Sports Direct must provide (i) an indication of the offer price, form of consideration and any other terms of such possible offer; (ii) a clear plan of how Debenhams’ existing debt – which will fall due on any change of control – will be repaid; and (iii) a proposal that addresses the immediate funding requirements of the business.”
Sports Direct will have until 5pm on 22 April to announce either a firm intention to make an offer for the company or state that it does not intend to make an offer.
Debenhams has also acknowledged a request from Sports Direct to convene a shareholder meeting on 21 March.