Debenhams/Frasers Group: will Mike Ashley really save the day?
In a dramatic 11th-hour intervention that could save up to 12,000 jobs, the retail tycoon Mike Ashley has “revived his interest in taking over the struggling department-store chain Debenhams”, said Sam Chambers in The Sunday Times. A deal to buy the 242-year-old group would bring “much-needed relief” to Britain’s reeling high streets: Debenhams had looked set to disappear “for good” after JD Sports ditched a buy-out offer last week. It would also “mark a happy culmination to Ashley’s dogged and often rancorous pursuit of Debenhams”: he lost an estimated £150m last year when his shares were wiped out in a debt-for-equity swap.
“Let it go, Mike” is never a line that works with the stubborn Sports Direct founder, said Nils Pratley in The Guardian. He was bound to show up to take another look. But maybe this time a deal could work. Having ditched the onerous leases on its 124 stores, Debenhams is a “slightly different beast” these days from the one Ashley pursued last year. And there must be “40 or so Debenhams stores in decent locations” that his Frasers Group can make something of. Still, “time is short”.
Is Ashley serious about a deal? Don’t count on it, said Ben Marlow in The Daily Telegraph. The tracksuit-to-trainers king “will do anything for a bit of attention” – whether “throwing up in fireplaces in the name of team-building”, or taunting his rival, Philip Green, with offers of an “emergency loan” to save Arcadia. But his “high-street saviour act has worn thin”. It’s easy to dismiss Debenhams as a lost cause. Actually, though, it has got a well-regarded online arm along with a core group of profitable stores that could tempt other bidders. Whatever Ashley might say, “it shouldn’t be assumed he is the only game in town”.