Baugur-owned designer brand Matthew Williamson has rejected speculation that it is to pull its Designers at Debenhams range from the department store chain.
Industry insiders said that Baugur and Matthew Williamson have become increasingly disillusioned with Debenhams' constant markdowns and were threatening to pull the plug on the Butterfly by Matthew Williamson range to protect the premium credentials of the brand's mainline.
Williamson will return to show at London Fashion Week this September after a five-year break, increasing speculation he is under pressure to protect the mainline.
But Matthew Williamson chief executive Joseph Velosa said the exit rumours were unfounded. "There are no plans to discontinue our relationship with Debenhams. We have not had any discussions with the company about it," he said.
The Debenhams tie-up began in 2002. Baugur added Matthew Williamson to its roster of fashion businesses last year.
Debenhams declined to comment and Baugur was unavailable for comment.