Debenhams on brink of collapse as it appoints administrators putting 20,000 jobs at risk – The Sun

DENENHAMS is on the brink of collapse after bosses confirm that it is looking to appoint administrators.

The failure of the chains of department stores puts 20,000 jobs at risk.

The household name was already struggling before the impact of coronavirus hit the high street.

The majority of its staff are currently being paid under the government's furlough scheme while all 142 stores remain shut under government rules to close all non-essential shops.

The pre-pack arrangement doesn't mean that the chain has entered liquidation but rather it's a move to protect the firm from going bust while stores are shut.

In short, the owners want to push the business into administration and then buy it back debt-free.

In a statement, Debenhams said: "Department store group Debenhams today has filed a Notice of Intent to appoint an administrator in the UK.

"This move will protect Debenhams from the threat of legal action that could have the effect of pushing the business into liquidation while its 142 UK stores remain closed in line with the government's current advice regarding the Covid-19 pandemic.

"The group is making preparations to resume trading its stores once government restrictions are lifted."

It says that it's preparing to enter a "light touch" administration that will see the existing management team remain under supervision of the administrators.

It has not yet specified who has been appointed administrators although accountancy firm KPMG is understood to be one of those on call to handle the process.

Customers can still shop online in the UK, Ireland and Denmark and it hopes the measures will mean than stores can open again once the lockdown is lifted.

Giftcards are still being accepted and returns are still being processed normally.

Debenhams said it has the support of its lenders to enter administration and is engaging with employees and suppliers over the move.

More to follow…

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