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Sports Direct has criticised Debenhams for rejecting its offer to acquire its Danish company Magasin Du Nord for £100m.
On Friday (22 March), the struggling department store announced it had secured a £200m refinancing lifeline, shortly after Mike Ashley’s Sports Direct made the proposal which gave Debenhams the 12 month option to buy the company back at the price at which it was sold.
In a statement today, Sports Direct said the offer made was in “excess of fair value” and it did not receive a response to indicate that Magasin was “worth more than the £100m offered”. It added the offer was one of several made to give Debenhams “a valid alternative to its apparent view that multiple insolvency processes are required to address [its] current liquidity concerns and to facilitate a wider balance sheet restructuring”.
It went on to say that while Sports Direct had engaged in discussions with Debenhams’ advisory group, the same could not be said for the board of the department store. It said: “This lack of engagement and the related limited access to information has made it very difficult for Sports Direct to present a proposal that addresses Debenhams’ funding and restructuring requirements beyond the immediate liquidity need.”
The statement also said it did not consider House of Fraser to be a competitor to Debenhams; in January, Ashley saved House of Fraser from administration in a last minute £90m deal.
The statement concluded: “In any event, were Ashley to become CEO of Debenhams he would, as previously announced, step down from his roles at Sports Direct. He would also be subject to fiduciary duties to Debenhams. Sports Direct would strongly recommend that the Debenhams board reconsiders the offers made by Sports Direct to date and their own duties as directors of Debenhams.”
