Sports Direct receives support for Mike Ashley’s CEO appointment of Debenhams

Sports Direct receives support for Mike Ashley’s CEO appointment of Debenhams

Sports Direct (LON:SPD) announced on Monday that numerous Debenhams shareholders have expressed their support for the appointment of its boss, Mike Ashley, as CEO of the struggling department store (LON:DEB).

Shares in Debenhams were almost 10% lower during early trading on Monday.

In a brief statement Sports Direct said that it had been contacted by a number of the department store’s shareholders with regards to the protection of their own interests as shareholders. Additionally, Sports Direct said that these shareholders have also expressed their support for the appointment of Mike Ashley as CEO.

As a result, it is making a template letter available to any shareholder in Debenhams in the event that they wish to express their views directly to the department store chain.

Since the beginning of March, Mike Ashley has been battling for control of Debenhams, with back and forth moves being made from both sides.

Monday’s announcement is the latest in Mike Ashley’s struggle for leadership, insisting that his appointment to CEO is desired by many of the department store’s shareholders.

Mike Ashley, who currently owns a 30% stake in the business, has been given the opportunity by Debenhams to save his holdings as long as certain conditions are met. Debenhams had previously said its restructuring plans could wipe out its existing shareholders, Sports Direct included.

Last week Sports Direct announced that is was considering taking full control of Debenhams with a £61.4 million bid for the company.

Debenhams said that Sport’s Direct’s offer “did not provide a solution to the group’s immediate working capital needs.” Despite this, another of its major shareholders, as well as Mike Ashley, have been given until the 8 April to make an offer. This bid must, however, address the department store chain’s debt as a satisfactory level.

Last year Sports Direct purchased House of Fraser for £90 million.

At 10:26 BST Monday, shares in Sports Direct International plc (LON:SPD) were trading at +1.10%. Shares in Debenhams plc (LON:DEB) were trading at -9.75% (10:39 BST).