Debenhams on brink of collapse putting 22,000 jobs at risk
6 April 2020, 10:28 | Updated: 6 April 2020, 10:54
High street department store Debenhams is on the brink of collapse after bosses confirmed it has filed a notice of intent to appoint administrators.
This would affect 22,000 workers across 142 stores across the UK.
Earlier this week, it was reported the company had lined up accountancy firm KPMG to handle the process.
The current owners want to push the business into administration then buy it back debt-free.
Debenhams explained: "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 company, which has filed a notice of intent to appoint an administrator, added it is making preparations to open again once Government restrictions are lifted.
"The group is preparing to enter a 'light touch' administration that will see the existing management team remain in place under the direct control and supervision of the administrators," it said.
The majority of its employees in the UK are currently being paid under the Government's furlough scheme, after its stores closed following the shutdown of non-essential shops.
It added that it continues to trade online across the UK, Ireland and Denmark and customer orders, gift cards and returns are being accepted and processed normally.
Debenhams said it has the support of its lenders to enter administration and is engaging with employees and suppliers over the move.
Debenhams has furloughed store staff after it was forced to close its stores temporarily following the Government-mandated shutdown.
The department store business has closed 22 shops in recent months as part of plans to shut 50 sites and bring its total estate to 110.