Debs sinks as traders question Ashley plot
A RAID on Debenhams by Mike Ashley would leave his current company Sports Direct in the hands of an inexperienced finance boss, analysts at Jefferies have warned.
Billionaire tycoon Ashley last week said he wants to sack almost all of Debenhams’ board and become its chief executive while standing down at Sports Direct.
The 54-year- old, who founded Sports Direct in the 1980s after an injury derailed his burgeoning squash career, plans to leave the company in the hands of deputy chief finance officer Chris Wootton.
But Jefferies analysts said the plot has raised eyebrows.
They added: ‘Wootton may be a rising star (we do not know him) but we note he has been a deputy chief financial officer for barely a year, a chief accountant for only a year, and around three years ago was still just a manager at PwC. That is a rapid rise to the top of a listed company.’
Shares in Debenhams fell 2.6pc, or 0.09p, to 3.4p, on worries that Ashley might now be forced to think again about his proposed shake-up. Sports Direct shares rose 1.8pc, or 4.7p, to 269.9p.
The FTSE 100 closed just in the black, bolstered by a fall in the pound on expectations Theresa May would lose her crunch Brexit vote. The pound fell as much as 1pc against the dollar to a low of $1.301 in early trading when the likelihood of defeat became clear.
A weaker pound typically boosts the Footsie because so many of its big international companies earn money overseas in foreign currency. This is then worth more when it is brought back to Britain and swapped for sterling.
The Footsie rose 0.29pc, or 20.53 points, to 7151.15. Meanwhile, embattled government contractor Interserve lost even more ground as a vital vote on its future edged closer and conflict with its biggest shareholder, Coltrane, heated up further.
On Friday shareholders will vote on a rescue deal that would see Interserve lenders take a 95pc stake, cutting current investors’ stake to just 5pc. If the deal doesn’t get through, the company will collapse into insolvency.
But yesterday it emerged that Coltrane has piled more pressure on Interserve, writing to proposed administrator EY to demand that, if the vote fails to pass, EY must market the company to potential buyers instead of immediately selling to creditors. Shares closed down 7.1pc, or 1p, to 13.15p.
At Cairn Energy shares shed 4pc, or 7p, to 167.7p, after it revised down estimates of reserves at its flagship oil and gas field in the North Sea by 19pc. It took a £127m charge after it cut its Kraken reserves by 6.8m barrels of oil.
The news also dragged down shares in oil firm Enquest, which is a partner in the flagship project with a stake of around 70pc and which lost 13.9pc, or 2.56p, to finish at 15.92p. The boss of mattress maker Eve
Sleep will hope for a bit of shuteye after he shook up the management team amid a dramatic turnaround plan. Abid Ismail and Felix Lobkowicz, finance and operations chief respectively, will leave and chief brand officer Kuba Wieczorek will move to a part-time consulting role under the plans by new boss James Sturrock.
The company also said it would end a commercial relationship with mattress-seller Dreams – just 18 months after the partnership began – as it announced that its pre-tax loss had widened by 1.3pc to £20.3m.
But revenue rose by a hearty 25pc to £34.8m, and shares lifted 6.1pc, or 0.5p, to close at 8.75p.
Finally, car retailer Pendragon skidded to a £44.4m loss as its revenue fell by more than 2pc, hurt by a fall in new car sales. Shares rose 1.5pc, or 0.4p, to 26.8p.