- Huw Hughes |
Debenhams bondholders have given the green light for a 200 million pound refinancing scheme that hopes to breathe life into the struggling department store chain.
In an announcement on Thursday, Debenhams said it had received approval from the majority of holders of its 5.25 percent senior notes due 2021 to change the terms of their bonds. The news means that Debenhams is one step closer to securing 200 million pounds of extra funds from its lenders as part of its restructuring plan.
Last week, Debenhams released a statement asking its existing lenders for the 200 million pound cash injection as it continued to fend off a takeover bid from Mike Ashley’s Sportsdirect. The company warned shareholders, however, that they face losing their investments if it doesn’t go to plan, saying: "certain of these options - if they materialise - would result in no equity value for the company's current shareholders."
Sports Direct, which already owns a near 30 percent share stake in Debenhams, announced this week it was considering buying the remaining 70 percent at 5p per share. The possible firm offer, equating to about 61.4 million pounds, would require Ashley to be appointed CEO of Debenhams, and Debenhams to terminates its noteholder consent solicitation process.
Photo courtesy of Debenhams