Retail powerhouse Sports Direct has surprised the markets by taking a 4.6% stake in ailing department store Debenhams.
The value chain, built by colourful Newcastle United owner Mike Ashley, said it had bought the 56.8 million shares to “explore options” for collaboration.
And it said the deal – which was not previously disclosed to the Debenhams board – would boost prospects for investors in both firms.
“Sports Direct has communicated to Debenhams’ board its desire to work together and its intention to be a supportive shareholder,” the company added.
Debenhams, which was badly hit by woeful Christmas sales and the resignation of its under-pressure finance chief, said it was interested in exploring what the fresh tie-up could achieve.
“Debenhams is open minded with regard to exploring operational opportunities to improve its performance, alongside its own existing and planned initiatives, in order to create value for all Debenhams shareholders,” it said.
Sports Direct climbed into the FTSE 100 in September, after continuing a run of market-leading sales performances. The business is now worth more than £4.3bn.
