Debenhams enters administration – stores to continue trading

High street retailer Debenhams has “fallen into the hands of its lenders” after it was announced it had entered administration.

The move means that there are no immediate closures and stores will trade.

However it is thought that up to 50 of the 166 stores had been earmarked for closure in the future.

The Financial Conduct Authority this morning “temporarily” suspended shares in Debenhams at the request of the company.

Sports Direct’s Mike Ashley made a £150m offer that was rejected in the last 24 hours, that was improved to a £200m offer earlier this morning. This was also refused.

A statement posted on the Debenhams website this following the announcement, reads: “On 9 April 2019, Debenhams plc (‘the Company’) entered Administration, and Chad Griffin, Simon Kirkhope and Andrew Johnson of FTI Consulting LLP were appointed as Joint Administrators (‘the Joint Administrators’).

“The appointment was made by the Company’s qualifying floating charge holder under the provisions of Paragraph 14(1) of Schedule B1 to the Insolvency Act 1986.

“For the avoidance of doubt only the Company (which was the Group’s top holding company) is in administration – the Group’s operating companies, including Debenhams Retail Ltd and Magasin Du Nord, continue to trade as normal.

“The Group’s commercial relationships with suppliers, employees, pension and customers are all with the operating companies. Therefore the Group’s commercial stakeholders are not adversely impacted by the Company’s administration.

“Immediately following their appointment, the Joint Administrators sold the Company’s shares in the Group, to Celine Newco I Limited, an entity owned by certain of the Company’s secured lenders (“the Transaction”).

“The Transaction delivers continuity for all Group operations. It minimises business disruption, ensures continuity for the businesses and their suppliers and protects the Group’s employees. It also allows additional funding of up to £99m to be provided.

“The affairs, business and property of the Company are being managed by the Joint Administrators, Chad Griffin, Simon Kirkhope and Andrew Johnson, who act as agents of the Company only and without personal liability.”