Mike Ashley calls for Debenhams advisers to be jailed

By

Sandra Halliday

Published
Mar 29, 2019

Sports Direct’s Mike Ashley has lashed out at Debenhams advisers for moving forward with plans to undertake a drastic restructuring which could see his and all other shareholders’ equity wiped out.

The retail tycoon, who owned a 30% stake in Debenhams prior to its restructuring, had considered making a £61.4m takeover bid for the cash-strapped chain to prevent it from launching that restructuring.

He also offered to provide a much-needed loan - but only if he was appointed as chief executive officer of the department store group.
Debenhams hs rejected all his attempts, and on Thursday revealed it had enough support from bondholders to press ahead with its own refinancing efforts, the detail of which it announced on Friday.

“Now the results of the vote are known... I think that if there were any justice in the world the majority of the advisors would be put in prison,” Ashley said.

Debenhams’ £200m refinancing plan required bondholders to approve changing the terms of some of their bonds to allow the company to access a new loan facility provided by existing lenders.

This will likely lead to a restructuring which could take the form of a debt-for-equity swap or a pre-pack administration. Both options would lead to existing shareholders losing their holdings in the company.

Debenhams chairman Terry Duddy said the funding package “secures the future of the Debenhams business and provides reassurance for Debenhams' employees, pension holders, suppliers, lenders and other stakeholders.”

In a statement released on Friday he said: “We will now move to the next phase of the restructuring of the business, which includes reducing rents and reshaping our store portfolio, as we have referenced in previous announcements. These actions are necessary to ensure the strongest possible platform to support the business going forward.”