Mike Ashley's Sports Direct has made a revised £200 million rescue offer for Debenhams, delaying the department store's prospective administration.
The billionaire had an offer to underwrite a £150 million rights issue rejected on Monday.
READ MORE: Debenhams ‘is now preparing to go into pre-pack administration’
Lenders to Debenhams said the latest proposal, on the terms set out, including that Mr Ashley be made chief executive of the chain, 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 £200 million.
"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 April 8 deadline.
"The company anticipates making a further announcement during the course of the day following further discussions with its lenders."
READ MORE: Debenhams on brink of administration: Everything we know so far
Debenhams is now widely expected to fall into administration and the retailer's lenders seize control of the company in a move tipped to trigger store closures and job losses.
Shareholders such as Mr Ashley's Sports Direct, which holds a 30% stake, will see their investments wiped out.
The pre-pack administration undertaken by the struggling department store chain will see its debt reduced and comes ahead of a wider restructuring which will see around 50 stores close via a Company Voluntary Arrangement.
Last night, a source connected to Debenhams said that for the company, which has 14 stores in Scotland, the most likely outcome is now the announcement of a pre-pack administration arrangement.
If Debenhams was to fall into administration, it would mean losses for shareholders, including Mike Ashley who has a 30% stake in the chain.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here