Debenhams PLC on March 11 confirmed that it is in advanced negotiations with lenders for additional credit facilities of about £150 million, according to a London stock exchange filing.
The struggling U.K. department store chain, which deemed its full-year guidance as no longer valid on March 5, said it will use £40 million of the additional credit facilities to refinance the bridge facility it secured from Li & Fung Ltd.
The announcement comes after the Financial Times (London) reported that Debenhams aims to increase the amount it needs for refinancing in order to fend off Sports Direct International PLC's efforts to seize control of the company.
Debenhams wants to make the refinancing "as watertight as possible," a source reportedly told the newspaper.
Sports Direct, which owns a 29% stake in the U.K. department store operator, according to the Financial Times, demanded the removal of all of Debenhams' directors, except for Rachel Osborne who became a director in September 2018, according to a news release.
The British sportswear retailer also said it also wants its CEO, Mike Ashley, to be appointed to the board. If appointed, Ashley is expected to step down as director and CEO of Sports Direct and will be replaced by Deputy CFO Chris Wootton, who would become acting CEO.
In an e-mailed statement to S&P Global Market Intelligence, the department store chain confirmed that it has received Sports Direct's notice and expressed its disappointment with the company's actions.
Sports Direct also holds stakes in clothing chain French Connection Group PLC and electronics company GAME Digital PLC. It bought House of Fraser Group Ltd. for £90 million in August 2018 and was reportedly interested in buying music store chain HMV Group PLC.