Lawyers for tycoon Mike Ashley’s Sports Direct have written to the administrators of Debenhams alleging a conflict of interest.
Law firm RPC claimed FTI Consulting was involved in advising Debenhams, handling the retailer’s pre-pack administration under which lenders seized control and was “heavily involved” in the “failure by the company, its lenders and advisers to seriously engage” with Sports Direct, the BBC has reported.
The lawyers said: “It is clear that you are conflicted.”
Debenhams, in which Sports Direct was the biggest shareholder, was put through a pre-pack yesterday when lenders including banks and hedge funds took control but shareholders were wiped out.
FTI rejected Sports Direct’s allegations. The joint administrators said: “We understand that Sports Direct as a shareholder will be disappointed that there is no value in the equity.
“However, the transaction delivers continuity for all group operations and was in the best interests of the group’s creditors, employees, customers, pension holders and suppliers.
“We are entirely satisfied that the sale was in the best interests of the company and its creditors, as explained in some detail in the SIP16 pre-packaged administration report. We also note that a sale process is being undertaken and Sports Direct has been invited to participate.
“We are officers of the court and have a duty to act in the best interest of Debenhams Plc and its creditors. We strongly refute our actions in undertaking a sale for the benefit of the company’s creditors were subject to any conflict of interest.”