Department store Debenhams has officially gone into administration after the shop rejected plans by Sports Direct’s Mike Asheley to save it.
FTI Consulting has now been appointed as administrators for the chain, whose shops will continue trading for now.
Debenhams is expected to close 50 of its 165 stores in the future, but no timescale has been announced yet.
Debenhams’ chairman Terry Duddy said: “It is disappointing to reach a conclusion that will result in no value for our equity holders. “
He added that the move allows Debenhams to continue trading as normal for now.
“We remain focused on protecting as many stores and jobs as possible, consistent with establishing a sustainable store portfolio in line with our previous guidance,” he said.
“In the meantime, our customers, colleagues, pension holders, suppliers and landlords can be reassured that Debenhams will now be able to move forward on a stable footing. I would like to thank them all for their recent and continuing support.”
As well as planning closures, the chain – which employs about 25,000 people – has been renegotiating rents with landlords.
Its lenders are made up of High Street banks and US hedge funds including Barclays and Bank of Ireland, as well as Silver Point and GoldenTree.
It has not released a list of which shops may be shut.
Debenhams suspended trading in its shares at 8am this morning after rejecting a last-gasp effort from Sports Direct to snatch it from the jaws of administration.
Ashley’s Sports Direct had made a revised £200 million rescue offer for Debenhams, in an attempt to delay the department store’s likely administration.
The offer involved underwriting a rights issue which would see existing investors buying newly issued shares and is an advance on an £150 million plan tabled on Monday, which was rejected.
And for customers? The advice is act quickly.
Which? consumer eights editor Eleanor Snow,, said: “Debenhams has long been a staple of the British high street so this is a worrying time for its customers and they may find their consumer rights are affected.
“If you have gift vouchers or have bought something you are intending to return do this now as you may not be able to do so if the store ceases trading.
“If you are planning to buy something for more than £100 in Debenhams, make sure you use a credit card so you can make a claim against your credit card company under Section 75 if anything goes wrong.”
Here’s what you need to know about your Debenhams refund and gift card rights.