- Prachi Singh |
Retail tycoon Mike Ashley has announced his intention to take over the struggling department store chain Debenhams. Sports Direct International announced through a statement that it has requisitioned a general meeting of Debenhams plc (Debenhams) to appoint Ashley to the board of directors of the company and to remove all of the current members of the Debenhams board, except Rachel Osborne who became a director in September 2018. Ashley holds 30 percent stake in Debenhams.
The company added to the statement that if Ashley were to be appointed to the board of directors of Debenhams during this business critical period for the company, he would carry out an executive role, and would focus on the business, including building a strong board and management team.
If appointed, Ashley has offered to step down from his current role as a director and CEO of Sports Direct leaving the responsibility of running the business to Sports Direct’s deputy CFO Chris Wootton, as the new acting CEO.
Ashley would step down from Sports Direct for new Debenhams role
In a recent trading statement on March 5, 2019, Debenhams issued another profit warning citing higher turnaround costs and lower sales.
In December, Ashley lashed out at Debenhams after the UK retailer refused his offer of a 40 million pound cash injection, according to the Daily Telegraph. In a letter published by the UK newspaper, Ashley warns Debenhams CEO Sergio Bucher that without the money the retailer "has zero chance of survival".
If Ashley gains control of Debenhams, it would be the latest UK retailer to add to his empire, which currently includes House of Fraser, Flannels and Evans Cycles. Earlier this week, Ashley also filed a bid for British home shopping company Findel.
Sports Direct acquired 6,000,000 Findel shares at a price of 161 pence per share from City Financial Absolute Equity Fund. The company expects the acquisition to settle on March 6, 2019 and following the acquisition Sports Direct said in a statement that, in aggregate, it will hold 31,850,000 Findel shares, representing 36.8 percent.
Picture:Debenhams press area