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Sports Direct circles Debenhams as lenders consider pre-pack

Sports Direct has confirmed that it would seek to buy Debenhams if the department store chain collapsed into administration.

Chris Wootton, deputy chief financial officer of Sports Direct, told The Financial Times the department store’s administration “was not the outcome we want”, but acquisition was a possibility.

However, The Times has reported that lenders to Debenhams could consider a pre-pack administration to prevent Sports Direct taking control.

Last week, Sports Direct offered Debenhams a £150m interest-free loan under proposals that would also see the retail tycoon take the reins as director and chief executive of Debenhams.

The loan would be interest free if Debenhams issued shares allowing Sports Direct to increase its stake in the business from 30% to 35%. If not, the loan would come with 3% interest charges.

Industry stakeholders have told Drapers that involvement of Sports Direct would be unlikely to revive the department store.

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