April 6, 2020 @ 12:56 by Richard Dawson
Department store chain Debenhams has today (April 6) filed for administration for the second time after being rescued by its lenders only 12 months ago.
The struggling retailer has been severely impacted by Government advice in relation to the COVID-19 pandemic, with all 142 of its UK stores having to close as a result.
It is hoped that the administration notice will protect the company’s assets from creditors who could push for liquidation and ensure that the business is able to trade again when the lockdown is lifted.
Debenhams employs 22,000 people across the UK and has a significant presence in the North East with department stores in Newcastle, Gateshead, South Shields and Sunderland.
The company is preparing for a ‘light touch’ administration that will see the existing management team remain in place under the control and supervision of the administrators.
The majority of Debenham’s employees are being paid under the Government’s furlough scheme owing and suppliers who continue to provide goods and services during the administration will be paid in terms.
Debenhams continues to trade online across the UK, Ireland and Denmark and customer orders, gift cards and returns will be processed normally.
Stefaan Vansteenkiste, CEO 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.”