Ads
Published
Mar 15, 2017
Download
Download the article
Print
Text size

Sports Direct increases its interest in Debenhams

Published
Mar 15, 2017

Sports Direct has strengthened its ties with Debenhams again by taking its interest in the department stores chain to more than 11%.


Mike Ashley


Mike Ashley's company entered into a put-option deal with Goldman Sachs over a 10.5% stake in Debenhams in January 2015, which was extended by one year in May 2016.

The arrangement is a bet that Debenhams’ share price will rally, and allows Sports Direct to gain access to a sizeable stake without tying up capital.

If shares are above a fixed prearranged price when the options expire later this year, Sports Direct will receive the premium – a profit for the company and its owner.

Additionally, Sports Direct has now acquired a further 0.56% interest in the retailer through another financial instrument, called “contracts for difference”.

Sports Direct has also a 9% stake in department stores company House of Fraser and hit the headlines earlier in February when it emerged as the owner of an 11% stake in troubled fashion retailer French Connection.

Copyright © 2024 FashionNetwork.com All rights reserved.