LENDERS seized control of Debenhams moments after the company was placed into administration in a move that wiped out the worth of stakes held by shareholders in an instant.

The move to so-called pre-pack administration rendered the stakes held by Sports Direct chief Mike Ashley and all other investors worthless.

Mr Ashley, who had made a £200 million funding offer in the days preceding the administration, has called for the process to be reversed.

The slip into administration also cancels plans for a shareholder meeting in which major shareholder Mr Ashley was to seek appointment to the board.

In a statement issued to the market on Tuesday afternoon, Mr Ashley said the administration should be reversed and Sports Direct given access to information to “save the business for all stakeholders”.

READ MORE: Debenhams in administration but 'trading as normal'

Administrators at FTI Consulting were appointed to the retailer at just before 10am on Tuesday and immediately sold the group’s operating companies to a new entity owned by its lenders.

The process does not affect the retailer’s pension scheme, suppliers, landlords or its immediate trading plans.

Terry Duddy, Debenhams chairman, said: “It is disappointing to reach a conclusion that will result in no value for our equity holders.

“However, this transaction will allow Debenhams to continue trading as normal, access the funding we need, and proceed with executing our turnaround plans, whilst deleveraging the group’s balance sheet.

“We remain focused on protecting as many stores and jobs as possible, consistent with establishing a sustainable store portfolio in line with our previous guidance.”

READ MORE: Mike Ashley calls Debenhams administration a "national scandal"

Earlier in the day, Mr Ashley’s Sports Direct had made a revised offer that involved underwriting a rights issue which would have seen existing investors buying newly-issued shares and was an advance on an £150m plan tabled on Monday, which was rejected.

Under the proposal, Debenhams’ lenders would have had to agree to write off £82m of its £720m debt mountain, as well as install the tycoon as chief executive.

Lenders to Debenhams said the proposal, on the terms set out, was “not sufficient”.

Debenhams said in a statement: “The board confirms that it received a revised, highly-conditional, proposal from Sports Direct in the early hours of April 9, which indicated a willingness of Sports Direct to underwrite an equity issue of £200m.

“The company’s lenders have confirmed to the company that the proposal, on the terms set out, was not sufficient to justify an extension to the 8 April deadline.”

READ MORE: Debenhams on brink of administration: Everything we know so far

The pre-pack administration - where disposal of some parts of a business are usually agreed ahead of administration - that has been undertaken by the 165-store chain will see its debt reduced and comes ahead of a wider restructuring which will see around 50 stores close.

The firm, which has 14 stores in Scotland, has not outlined whether any further changes are planned.

Sports Direct also said on Tuesday that it was no longer looking at making a formal takeover offer for Debenhams.

However, advisers at Lazard have been instructed to oversee a sale process for the retailer which will launch immediately, leaving the window open for Mr Ashley or another buyer to gain control of the chain.

Any bid would need to include the full repayment of the group’s debt.

Laith Khalaf, equity analyst at Hargreaves Lansdown, said it was a “hefty price tag to stump up for a company that’s struggling to make ends meet”.