Debenhams on the brink after refusing £150m offer

0 The embattled chain appeared to be heading for administration after rejecting Ashley’s offer

Sports Direct’s £150 million rescue offer for Debenhams has been rejected, putting the department store on course for a probable administration.

The rescue package promised to underwrite a £150m rights issue, on the condition that Mike Ashley be made chief executive of Debenhams.

In a statement to the market yesterday afternoon, Sports Direct said its proposal had been rebuffed and called for the Debenhams board and its lenders to actively engage in negotiations to save the chain.

Ashley was previously given a deadline of 5pm yesterday to fulfil one of two conditions to prevent Debenhams from falling into the hands of lenders.

If neither is fulfilled, the retailer is likely to go into a prepack administration, wiping out Sports Direct’s near-30 per cent stake along with all other shareholdings.

This follows an extraordinary outburst from Ashley on Sunday, calling for two Debenhams board members to take lie detector tests and trading in its shares to be suspended.