UK retail boss and Sports Direct CEO Mike Ashley has served a notice to UK department store chain Debenhams, in a boardroom coup, for the removal of all its current board members.
Shares in Debenhams has since rose up to 40%. The news also follows Debenhams’ profit warning, which was issued earlier this week.
Ashley aims to remove all current board members except for current director Rachel Osborne.
If appointed, Ashley will become the CEO of the department store chain and will focus on creating a new board and management team, as well as grow its business. He will also step down from his current role at Sports Direct.
Sports Direct deputy chief financial officer and acting CEO Chris Wootton will succeed Ashley as the new CEO.
Sports Direct said: “Sports Direct wishes to reassure its shareholders that, if Ashley were to be appointed to the board of Debenhams and step down from his roles at Sports Direct.
“Sports Direct and Mr Ashley have every confidence that acting chief executive Mr Wootton and the other members of Sports Direct’s board and management team have the necessary expertise to continue to successfully run the Sports Direct business.”
In a separate statement, the board of Debenhams is said to be disappointed by the decision, as it has been in talks with Sports Direct and other stakeholders regarding options to restructure the company’s balance sheet.
The board mentioned that its discussions to address the company’s future funding requirements are well advanced.
Enhanced by Deborah Williams