STORE FEELS PENNY PINCH
DEBENHAMS shares may be worth just 1p each after it issued a fresh profit alert yesterday, City analysts warned.
There is speculation Sports Direct Mike Ashley “may well swoop” after the struggling department store chain said group sales fell 5.4 per cent in the past six months.
Despite a pick-up in recent weeks, bosses warned full year profit forecasts were “no longer valid”.
It saw Debenhams’ already battered share price tumble 2.8 per cent yesterday to just over 3p.
The fall left the chain with a stock market value of £37million, when its business rates bill alone is £80million.
Brokers at analysts Peel Hunt cut its target price for the shares to just 1p. Debenhams is in talks with its banks despite recently announcing £40million of emergency funding.
The firm has already earmarked 50 store closures but there are fears more could go.
Sports Direct is Debenhams’ biggest shareholder, with a 29.7 per cent stake. But Neil Wilson, chief analyst at Markets.com, said: “Mike Ashley may well still swoop – the rationale for a tie-up with House of Fraser remains compelling.” Mike Ashley AN Italian private equity firm has bought most of the classic British car maker Morgan.
Investindustrial has acquired a holding of about 75 per cent in the 109-year-old business.
It insisted Morgan’s base in Malvern, Shrops, would stay, with staff given a stake in the business.
Investindustrial is the biggest investor in Aston Martin Lagonda but the deal is not expected to result in the sharing of parts and people.
The deal was announced as Morgan launched its new Plus Six model at the Geneva Motor Show. WARNING Churchill could be hit