Shares in Debenhams soared up to 40% after Mike Ashley launched an attempted boardroom coup at the troubled department store chain.
But over at Sports Direct, shares fell by 2% in early trading in response to the retail tycoon’s plan to step down from the firm he founded back in 1982 and take the helm at struggling retailer.
Under the move, Sports Direct is seeking to remove of all but one of the current Debenhams board members and put the billionaire in charge of the business, which earlier this week issued a fresh profit warning citing higher turnaround costs.
Mr Ashley, who through Sports Direct is the largest shareholder in Debenhams with a 30% holding, was instrumental in ousting its chief executive and chairman from the board two months ago.
If successful, Mr Ashley would step down from his current roles as a director and chief executive of Sports Direct – and be replaced by deputy finance boss Chris Wootton in an acting capacity.
Mike Ashley would step down as Sports Direct chief executive under the plan
In an effort to reassure investors, the group said Mr Ashley has “every confidence” that Mr Wootton and the other members of the board and management team have the necessary expertise to successfully run the business.
Debenhams has indicated its existing board will resist the move – saying it was “disappointed” by the action and it was “focused on delivering the restructuring of its balance sheet”.
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But shareholders could be in the market for a shake-up under Mr Ashley, having seen the value of their holdings plunge steadily since 2015 – by 85% last year alone.
In full: Mike Ashley on the future of the high street
A turnaround plan currently being executed includes the closure of 50 stores with the loss of thousands of jobs as Debenhams grapples the fallout from years of stiff competition, particularly online.
Mr Ashley, who owns Newcastle United, has set his sights firmly on the department store sector – snapping up House of Fraser following its collapse last August and revealing an ambition to turn the chain into the “Harrods of the high street”.
In and exclusive interview with Sky’s Ian King at the end of last year, Mr Ashley revealed that House of Fraser could be merged with Debenhams.
What does Mike Ashley own?
:: Sports Direct
:: House of Fraser
:: Debenhams – has the largest 30% shareholding
:: Newcastle United
:: Evans Cycles
:: Online furniture retailer Sofa.com