Control of department store chain has fallen into hands of its lenders; 50 stores earmarked for closure.
Debenhams has officially entered administration today (April 9).
The department store chain has passed through a pre-pack administration process. This lets a company sell itself, or its assets, as a going concern, without affecting the operation of the business.
Debenhams had rejected a rescue offer from Mike Ashley’s Sports Direct, meaning that its lenders – which are made up of high street banks and US hedge funds – take control and look to sell it on.
This means that shareholders lose their investments, including Mike Ashley who had a 30% stake in the company.
Debenhams’ 166 stores will continue to trade as usual, although around 50 outlets have been earmarked for future closure.
Debenhams chairman Terry Duddy said: “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.
“In the meantime, our customers, colleagues, pension holders, suppliers and landlords can be reassured that Debenhams will now be able to move forward on a stable footing.”