By the end of September, Milestone Resources, Schroders and Old Mutual were said to have teamed up with Cenkos, which was previously revealed to be in talks with other shareholders about possibly replacing chairman Nigel Northridge and chief executive Michael Sharp.
“The trading strategy is not working,” a source close to the rebel group said in an interview with the ‘Sunday Times’. “There’s a reason why people have to promote—customers won’t pay full price when the product’s not desirable enough. It’s clear that people have been there too long, nothing’s changing and it’s one-way traffic,” the same source added.
Notably, the retailer has tried different solutions over the past couple of years to recover from a poor trading in 2013, when it issued two profit warnings. But heavy discounting, promotions and special offers have not helped, resulting in another bland quarter: the retailer reported flat sales for the quarter to June, which it blamed on three fewer days of discounting than usual.
In an attempt to reverse the fate of the company he leads, Sharp said in June that the group was on track to deliver full-year profits and margins in line with expectations, despite seeing no underlying sales growth in its third quarter.
Indian billionaire behind the shareholders´coup wins the pulse to Sharp
But that message was not enough for many of the company´s investors of reference who, led by A Dubai-based Indian billionaire, Mukesh "Micky" Jagtiani, have been pressing for a change at the management team of the company since September.
A little bit over a month after the so-called coup was initiated, Sharp has announced he will step down in 2016. Sharp, who has a 12 month notice period, will help identify his successor, with internal and external candidates considered. Several market insiders pointed to trading director Suzanne Harlow as the leading internal candidate.
"If Chairman Nigel Northridge means what he says - 'The board are confident we have a clear and effective strategy' - then ... Harlow will be in with a good chance, but if Debenhams decide to pursue a different strategy then an outsider will probably be brought in," said independent retail analyst Nick Bubb in a note Thursday.
Shares in Debenhams rose up to 4.6 percent on Thursday after the firm also posted 2014-15 profit in line with expectations and reported a good start to its new year. The company current market-cap stands at 1.04 billion pounds.
Debenhams posted an underlying pretax profit of 113.5 million pounds in the year to August 29, in line with forecasts. "We have had an encouraging start to the year, with strong new product launches which have been well received by our customers," added Sharp in a conference with analysts and investors.