Retail tycoon Mike Ashley has launched an audacious legal challenge to stall the turnaround plan at Debenhams, reigniting a bitter feud for control of the high street retailer.
The embattled department store chain confirmed today that it has received challenges to its company voluntary arrangements (CVA) from parties including Sports Direct, the budget sportswear retailer owned by Ashley.
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The challenge from Sports Direct, which saw its 29 per cent stake in Debenhams wiped out after falling into the hands of lenders, is Ashley’s latest move in a hard-fought tussle for control of the high street brand.
Debenhams executive chairman Terry Duddy branded today’s challenge “an unnecessary distraction as we implement our restructuring plans”.
A spokesperson for Celine UK NewCo 1, the new owners of Debenhams, added: “We note the spurious challenges to Debenhams’ CVA proposals, which were approved by the vast majority of landlords and more than 90 per cent of all creditors. We will move forward with our debt restructuring process as expected. The CVA provides a platform to deliver a turnaround in the business for which the lending group has committed £200m of new funding and remains supportive.”
The news comes a day ahead of a vote on fellow retail tycoon Sir Philip Green’s own contentious plans to embark on a CVA.
Earlier today Sky News reported that shopping centre landlord Intu was not prepared to accept the terms of the CVA, putting Green’s chances of passing the restructuring on a knife edge.
If the vote fails to achieve the 75 per cent approval it needs from creditors, Green’s Arcadia fashion empire, which includes brands such as Topshop and Dorothy Perkins, is expected to collapse into administration.