Troubled department store chain Debenhams is on the brink of administration as management attempts to protect the business from its creditors.
The 242-year-old department store group has appointed Geoff Rowley and Alastair Massey of FRP Advisory to advise on the “light touch” administration of the company, which has 22,000 employees.
Debenhams said it was a “necessary step” it protect the firm from the threat of legal action – potentially from suppliers – that could push the group into liquidation. The retailer has hundreds of millions of pounds of inventory on order from suppliers that it no longer needs amid the coronavirus crisis.
The chain’s 142 stores are closed and Debenhams said it plans to reopen all of them once government restrictions on non-essential stores are lifted.
Debenhams continues to trade online and customer orders, gift cards and returns are being accepted and processed normally.
Stefaan Vansteenkiste, chief executive of Debenhams, said: “These are unprecedented circumstances and we have taken this step to protect our business, our employees, and other important stakeholders, so that we are in a position to resume trading from our stores when Government restrictions are lifted.
"We are working with a group of highly supportive owners and lenders and anticipate that additional funding will be made available to bridge us through the current crisis period.
“With their support and working with other key stakeholders, including landlords, pension trustees and business partners, we are striving to protect jobs and reopen as many Debenhams stores for trading as we can, as soon as this is possible.”
