The purchase by Sports Direct of department store group House of Fraser drew a cautious response from analysts on Monday, with some saying the deal could backfire on Mike Ashley, the sportswear retailer's founder.
With HoF rumoured to be close to collapse, it has emerged that the retailer is in emergency talks on a funding deal with several parties and Sports Direct tycoon Mike Ashley is a key figure in the negotiations.
Press reports that Debenhams faces a virtual vote of no-confidence as a beauty service that it recently touted as one of its big new attractions seeks an exit strategy and a new investor have been denied by both firms.
A big hit from Debenhams' problems dented the bottom line at Sports Direct in the latest year but the company said its elevation strategy is on course and its premium fashion ops, including Flannels, were stronger.
Struggling Debenhams faces a fresh challenge with credit insurers tightening up the terms for its suppliers, suggesting a lack of confidence in its turnaround. But the company has denied it’s facing a cash crunch.