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700k payoff for failure! an absolute disgrace
He has been compensated for some of his share buying - one not that long ago- sending out a buy signal to investors at 8p. codey taking a 5% stake alongside their short would also have been seen by many as a buy signal.
Let's see if any statement is issued by the Takeover Panel about the events and some case law has been quoted by the lawyers of spd so might still be some fireworks to come.
According to investopedia nothing happens. As the shares are worthless the debt is written off and the collateral is retuned to the shorter.
but was the contract with the company that shareholders had shares in [which became worthless?]
if so why was it honoured if the money ran out? if not, who is the contract with and did that create a conflict of interest?
simple questions that the administrators might be reluctant to address
Bleurgh. That pay off is sickening and wrong in every way
How can that be in the interest of the shareholders? I didn’t lose here and I’ve nothing against capitalism - this is just corruption at its worst.
To be fair, the company was fucked well before he came in.
It's still an obscene sum of money, but a contract is a contract right?
just wrong - over 20 years wages for the average worker as a reward for failure
Debenhams boss steps down with £700,000 payoff
On Thursday the retailer confirmed that Bucher was leaving and that its chairman, Terry Duddy, would temporarily take over ahead of a major store closure programme, to be unveiled next week, that will put thousands of jobs at risk.
https://www.theguardian.com/business/2019/apr/18/debenhams-boss-steps-down-with-700000-payoff
Interesting the CEO is now going this week .He should have gone a long time ago.He was voted off the BOD in January and they still kept him on.MA wanted to become CEO and this could have easily been done.The BOD have a lot of answers that they need to give as the who thing has an awful smell about it.
One of the RNSs implied that without immediate funding, they were about to become insolvent. That I think explains the desperate and rushed machinations. It also provides a convenient excuse for rebuffing MA's offers on two grounds. First: 'we needed immediate funds or we were bust'; and second: 'the funding offered by MA was insufficient in quantity'.
The BoD will be able to hide behind this reasoning and fudge it that way. They'll probably never have to explain to former owners their actions, or why said owners lost all of their equity. Sergio stepping down is a logical step for him since any action or investigation will then be frustrated by his severing his connections with DEB and lying low on holiday for a few months.
Atb
I am ok with my loss about £20,000 and happy to write it off if it was a genuine failure . but i do feel like others that it could have been an orchestrated fraud especially when it was rushed through so quickly and other options where dismissed plus MA never got a chance to turn things round.
I went through the FCA website and the links relating to financial misconduct and due to the answers I gave it was not something that was within the scope of the FCA to deal with and so the eventual link on their site after answering questions referred me to the Serious Fraud Office.
Like many others on here some more information from the BOD about why MA and other options were dismissed would have put our minds at rest.
You don't need to close. Eventually, the administrator releases a statement that there's no value to the equity and then your broker marks it as 0 and the shares never need to be / can't be returned.
You essentially borrowed shares, sold them in the market, took that cash from the sale and never gave back the share :)
You mean like MA's mate that made £30m? In theory return the equity they borrowed, but as it's now delisted. Nothing at all.
How will the shorters close in this situation? Just wondered...
As far as I recall it was SOME of the trade credit insurance that was withdrawn - it happen around October/November time from memory - and Debenhams had extended repayment terms for some suppliers beyond 60 days - yes, of course it had an impact on cashflow but it goes nowhere to explaining why debt apparently doubled nor why the lenders were so eager to get the restructuring sorted - bonds were not due to 2021. It's a mystery and as far as shareholders accepting their losses - from previous experiences it takes time to accept this - it hurts when a company is still trading. Also it's clear that Mike Ashley has NOT accepted this - hence why others may still cling on to hope..
Withdrawal of the trade credit insurance and the appointment of KPMG were the two big signs for real trouble ahead. I was wary of both but incorrectly chose to ignore these as clear sell signals.
They could accept it too! :)
Pearls, I haven't seen the numbers, but when did insurers stop underwriting trade creditors for deliveries to Debs? I would imagine they say a huge contraction in payables which is a direct cash outflow in a short period of time. Payables balance would've been £450-500m and operating at c.60 days. If this was halved, you'd see a £250m outflow within 30-60 days, which would be funded with the RCF, bridge loan and now new facilities. Not to mention they clearly needed money for rental payments. It's been a while since I had a close look at the cash flow statement, but I remember it being pretty dire, especially as earnings declined – all shortfalls were funded with new debt
"Board working actively to frustrate MA on doing a deal"
It's more likely they were under pressure from the lenders. As discussed, the debt holders were obviously in control of the business. You can see that in relation to the amout of debt v the capitalistion of the company.
Now if you are saying that a rights issue was to held with a value to adjust that difference it would be good to hear.
But at what price?
Would you need to strike the difference betweem say £620 million and the market value of say £40 million. Would you have been willing to pour that much more money into the business...........another £580,000,000?
I can't be bothered to look up the number of shares. Let's for ease say an emergency recap at an issue of 50p, against your purchase price of 2p.
Another 600,000 @50p.
Now would you have backed that to "rescue" the business from lenders.
If not, you might be see why lenders were worried and excersised their rights to put pressure on the company.
It's been a long day £580,000,000 of debt /1,286,828,853 shares
I certainly think investigators should look into how the debt ballooned from January when it was £286m to March when it became £620m yet the company still felt in January that it was a going concern with no need to alert investors to such oncoming problems. That does not seem reasonable and goes alongside the views many investors have had since, of the Board working actively to frustrate MA on doing a deal. I do not believe that MA's comments made the average DEB customer not shop any longer at the store. These are generally older customers, who probably could not care less about MA's comments.
Loading the company up with debt, despite saving £50m on dividends not being paid any more, and despite further cost savings of £80m being obtained, seems unbelievable in hindsight. In fact, the cost savings and no dividend should have led to a £130m+ improvement in DEB's cashflow. Instead, it deteriorated by £334m within just two months???How was it possible for things to deteriorate so badly within just two months? It is that primary question that most investors want proper answers to, especially as MA had private access to the books and accounts and decided they were acceptable, and stated as such during the period when he was not allowed to bid.
Something stinks here, and it is not the shareholders.
Still optimistic, shareholders will recover losses provided there Is FairPlay, guesstimation is it is worth more than £800m after CVA
LOL well some posters still remain on the MTV-CTAG-WRN-QPP threads to name a few - because there will still be news/updates for a while yet - the company still trades - and Mike Ashley might go down the legal action route - agree not now worth posting day in day out but the occasionally look in is merited in case someone has some juicy gossip :-)
If Debs is disfucticated....why are posters still posting. Or is there still a chance of our money back...lol
Mr Stefaan Vansteenkiste, a managing director at the professional services firm Alvarez & Marsal, is being lined up as chief restructuring officer of Debenhams?.
https://www.msn.com/en-gb/money/news/new-debenhams-owners-line-up-turnaround-chief/ar-BBVNrSJ?ocid=spartanntp