I am sitting here thinking why? Ashley the biggest shareholder offered to bail it out but board of directors refused it, even if they didnt like the deal, I would think its their responsibility to do "anything" to avoid going into admin. I feel the uk laws make this kind of thing too easy a process and needs rehauling.
debenhams goes into admin
- Thread starter chrcoluk
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The directors have a duty to all the shareholders, Ashley may be the biggest one (or is he just the biggest single one?), but the Directors have to consider what is the best for the all the shareholders and the business, if they believe going into a pre-agreed administration and coming out of it with one plan being better than Ashley's plan they have a duty to do it.
The lenders refused to back Ashley’s deal, and Ashley’s deal required their support.
By doing what they've done the shareholders lose everything. How is that benefiting the shareholders?
They do but how does making their shares worthless serve them?
So an admin that wipes out most debt they prefer? very strange lenders.
If i remember correctly, Ashley wanted to be appointed CEO of the company as a stipulation of the buyout. Debenhams already had a pre-arranged deal to wind down their company too so felt it was best to continue along that path.
https://www.bbc.co.uk/news/business-47864580
https://www.bbc.co.uk/news/business-47864580
It’s just the new money aristocracy having a spiff because they don’t like the fat **** telling them to **** off, they’d rather kill the company.
Probably put a smile on their faces when they could float about Ashley’s lost 150m investment.
Department stores are dead in the format they were, so it’s irrelevent either way. Shame though, Debenhams stores are chonkers, pension plans and councils will be most displeased at such a huge waste of space.
Probably put a smile on their faces when they could float about Ashley’s lost 150m investment.
Department stores are dead in the format they were, so it’s irrelevent either way. Shame though, Debenhams stores are chonkers, pension plans and councils will be most displeased at such a huge waste of space.
You say they are dead but go into John Lewis in Kingston on a Saturday...... it’s mad
John Lewis isn’t utter *****. Even I find some reasons to go into it, I barely notice Debenhams exists. My cutlery and bedding are from le johns.
Soldato
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As kid I spent half my Saturdays being dragged around Debenhams by my mum. It's shame to see so many places of my youth go this way but when you can get seemingly everything and anything on Amazon then it's little surprise.
And hands control of the company to them, the lenders. Not Ashley.
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When the wife and I go shopping we often drop into Debenhams, but only for the cafe, baby change facilities and occasionally the 70% off rail. I can't remember either of us have spent any significant money in there.
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Lenders thought Ashley would renege on his deal and pick the business apart, so they took control in the hope that it'd give them the best chance of getting their money back.
I think screwing Ashley was just a bonus rather than primary reason.
John Lewis is a bit of an exception to all of this as it's largely propped up by the (middle/upper) middle-class who think their service is worth spending the extra over purchasing the same item/service cheaper online.
But i suspect JL will eventually end up in the same boat as M&S (rather than disappearing like BHS) where they'll be forced to shutter stores as well as diverge towards profitable parts of the business (food in M&S case) due to the reduced footfall and increase in expenses (rent in particular).
I think screwing Ashley was just a bonus rather than primary reason.
John Lewis is a bit of an exception to all of this as it's largely propped up by the (middle/upper) middle-class who think their service is worth spending the extra over purchasing the same item/service cheaper online.
But i suspect JL will eventually end up in the same boat as M&S (rather than disappearing like BHS) where they'll be forced to shutter stores as well as diverge towards profitable parts of the business (food in M&S case) due to the reduced footfall and increase in expenses (rent in particular).
No, not handed it over, this was a 'pre-pack' administration where the lenders and the administrators agreed a price and arrangement for the lenders to buy it as soon as it entered administration. Ashley is annoyed because this move renders the shares virtually worthless, and he held around 30% of the company IIRC.
The lenders will now presumably look to sell the business as soon as possible, in parts or as a whole, to recoup as much of their loss as possible.
The lenders will now presumably look to sell the business as soon as possible, in parts or as a whole, to recoup as much of their loss as possible.
yeah its these pre packs I especially hate, to me a admin should be a last resort, when there is absolutely no other options.
It shouldnt be used as a cheap means to take control of a company or a cheap means of reducing liabilities. This is the type of things that I consider as abusing the system.
I did wonder the other day, and meant to follow up and look out of curiosity, just how much debt his companies are carrying and whether there's another motivation for increasing his high street portfolio.
What's the old saying: if I owe the bank £100,000 then I have a problem. If I owe the bank £100 million then the bank has a problem.
What's the old saying: if I owe the bank £100,000 then I have a problem. If I owe the bank £100 million then the bank has a problem.