Debenhams to remain under control of investors after no appropriate buyer found
Debenham’s will remain under the control of its investors after no alternative buyer was found for the struggling department store.
The retailer entered a pre-pack administration in April and ownership was passed into the hands of its investors, however, administrators FTI consulting launched a marketing process to sell the company.
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Celine, which is a consortium of Debenhams investors, said today that the bids received following the retailer’s administration “were not at the level required to be taken forward”.
The department store plans to push ahead with the two Company Voluntary Arrangements (CVAs) – one for property and one for retail – that will see up to 22 stores closed by 2020.
Debenhams needs to secure at least 75 per cent creditor approval for each of the CVAs at a meeting today in order to proceed.
Terry Duddy, Debenhams executive chairman, said he was “confident” that the retailer’s plans would be backed by its lenders.
“We are confident that we will receive support for our CVA proposals, which make sense for all parties, and will give us the platform to deliver a turnaround,” he said.
The department store fell into administration last month following a battle with the firm's management and Sports Direct chief executive Mike Ashley, who was a majority shareholder in the company.
Debenhams rejected a £200m equity offer from Ashley on the eve of it entering administration in order to avoid a takeover by the retail billionaire.
Read more: Revealed: Debenhams names 22 stores set to close
Celine chief risk officer Stefaan Vansteenkiste said: “The investor consortium is a committed long-term owner, which has provided Debenhams with £200m in fresh funding for the financial restructuring process and to fund the company's operating turnaround.
“Within the consortium, there is extensive turnaround experience, which we will deploy to support the management's plan and to position Debenhams for a long-term successful future."
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