Sports Direct boss Mike Ashley is allegedly funding the lawsuit that challenges Debenhams’ company voluntary arrangement because he wants to “eliminate a competitor”, the high court has heard.
The court case with landlord Combine Property Control Group (CPC), which owns six of the properties Debenhams lets, kicked off yesterday.
Sports Direct is financing the lawsuit to overturn the CVA. If successful, Debenhams may be tipped into administration.
Debenhams’ barrister, Tom Smith QC, accused Sports Direct, which owns rival department store House of Fraser, of wanting “to drive its principal competitor out of business”, so it could “pick up its assets on the cheap”, The Guardian reports.
But CPC’s barrister Daniel Bayfield QC argued that the CVA was void as it “goes beyond the jurisdiction” set out in the insolvency act and that it “unfairly prejudices the interests of the applicants”, according to the newspaper.
The case continues.