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Mike Ashley launches high court action over Debenhams collapse

According to the Times, the retail tycoon intends to ‘kickstart investigations’ into the department store’s directors and advisors following its collapse

Sports Direct owner Mike Ashley has reportedly gone to the High Court to set aside a settlement agreed with Debenhams and its administrators earlier this year.

According to the Times, the retail tycoon intends to “kickstart investigations” into the department store’s directors and advisors following its collapse.

If accepted, the High Court application would undo the settlement that took place with Debenhams’ administrators at FRP Advisory, where Ashleys’ Frasers Group agreed not to pursue legal action.

The original dispute arose when Debenhams filed for administration in 2019, as his near 30% stake in the firm was lost as a consortium of lenders took control of the business via a pre-pack administration.

In turn, Ashley agreed to settle for a purchase deal for the fixtures and fittings in the group’s empty stores.

The pre-pack administration cost Ashley a reported £150m, with appointed administrators FTI Consulting claiming at the time that the deal was in the best interests of Debenhams’ creditors and not subject to conflicts of interest.

While Judge Daniel Schaffer ruled that the circumstances of the firm’s collapse should be investigated by the official receiver, the Times reported that the current agreement between Ashley and FRP blocks this from happening.

FRP Advisory declined to comment.

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