Billionaire Retailer Ashley Loses Court Battle With Debenhams
Billionaire Retailer Ashley Loses Court Battle with Debenhams
(Bloomberg) --
Billionaire Mike Ashley lost out to Debenhams Plc again on Thursday as a court challenge to the embattled U.K. department-store chain’s restructuring plan failed.
In a blow to Ashley’s Sports Direct International Plc, a judge in the High Court in London ruled that Debenhams’s deal with landlords to accept lower rents should be allowed to go ahead. Ashley, who failed in an effort to buy the retail chain earlier this year, funded the suit against the “company voluntary arrangement” by six property companies who said the deal treated them unfavorably.
“We are delighted the court has today confirmed that our CVA is effective and will continue to be implemented as planned,” Debenhams’s Chief Executive Officer Stefaan Vansteenkiste, said in a statement after the ruling.
Representatives for Sports Direct declined to comment on the judgment.
Sports Direct was using the landlords’ challenge to advance its own interests, Debenhams said in court, with the aim of driving it out of business in order to pick up its assets at a bargain price.
Ashley had spent about 150 million pounds ($185 million) to acquire his stake in Debenhams, which was wiped out when its creditors took over. The retail tycoon made at least six approaches to the company, culminating in an offer to underwrite a 200 million-pound rights issue. All of those efforts were rebuffed, in part because of Ashley’s demand that he be installed as CEO.
--With assistance from Luca Casiraghi.
To contact the reporters on this story: Ellen Milligan in London at emilligan11@bloomberg.net;Irene García Pérez in London at igarciaperez@bloomberg.net
To contact the editors responsible for this story: Eric Pfanner at epfanner1@bloomberg.net, ;Vivianne Rodrigues at vrodrigues3@bloomberg.net, Chris Vellacott, John Lauerman
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