Shares in Debenhams tumbled on Wednesday as one of its key investors bailed out of the department store chain after suffering a sharp fall in the value of its holding since its flotation.

Merrill Lynch Private Equity, one of the three firms behind the buy-out of Debenhams, sold its remaining 6.2 per cent stake in the chain at 60p – against the 195p flotation price when the retailer was relisted in May 2006.