Sports Direct withdraws as party to Debenhams CVA legal challenge

Sports Direct has withdrawn as a party bringing an ongoing legal challenge against Debenhams’ company voluntary arrangements, but will continue to fund it. Debenhams said Sports Direct International plc and Sportsdirect.com Retail Ltd have withdrawn as parties to the outstanding challenge to Debenhams’ restructuring through CVAs.  The challenge was brought jointly by Sports Direct and the Combined Property Control Group. However, Sports Direct will continue to fund CPC’s legal challenge, and has agreed to bear any costs award that could be made against CPC and in Debenhams’ favour at its conclusion. Terry Duddy, Debenhams chairman, said: “As Sports Direct has now acknowledged, it did not have sufficient interest to challenge the CVAs, as its businesses are not adversely impacted by the proposals and therefore had no legal basis for a challenge. “However, by continuing to fund CPC’s challenge, Sports Direct is deliberately acting against the vast majority of Debenhams’ stakeholders, including the more than 90% of our creditors who supported our CVAs. I call on CPC to withdraw its action, which we will vigorously defend. “In the meantime, we continue to make good progress with the company’s restructuring plans, which are a vital step in preserving as many as possible of the jobs of the 25,000 people who work for Debenhams.”  M&G dropped its challenge against the troubled retailer’s CVA processes earlier this month. To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette