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Update: Sports Direct on Magasin du Nord sale

Sports Direct said it has not been formally approached by Debenhams with details of an offer for its Danish department store chain Magasin du Nord, following reports that it has threatened to block a sale.

The Sunday Times reported yesterday that Sports Direct, which has a 30% stake in Debenhams, is concerned that Debenhams will struggle to achieve a good deal for Magasin du Nord.

Debenhams confirmed it was reviewing its options for the chain, which is said to be a profitable business, earlier this year.

The retailer bought Magasin du Nord for £12.3m in 2009 in a bid to push into mainland Europe, and had planned to open a seventh location this year.

 “We want to clarify that we have not been formally approached by Debenhams with details of any offer for Magasin du Nord,” said a spokesman for Sports Direct. “We would of course consider any such approach on its merits at the time.

“We do not want to see Debenhams fall into administration, and any suggestion to the contrary is irresponsible and incorrect. As a significant shareholder we would be immediately financially disadvantaged if that were to be the case – quite apart from concern for employees and suppliers.”

The spokesman added that Sports Direct has been “strongly encouraging” Debenhams chairman Ian Cheshire that Debenhams should cut its dividend entirely and “manage cash more prudently for some time”.

“Indeed, Sports Direct has discussed various opportunities for business collaborations to support Debenhams over the last year or so, but the management/Board of Debenhams have chosen not to move forward with these proposals, as is their right,” he said.



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