Debenhams rescue plan could cost over 10,000 jobs - report
Debenhams’ attempts to keep itself afloat could lead to the shutdown of 90 stores across the UK and the loss of 10,000 jobs.
Debenhams
1.83p
15:45 08/04/19
FTSE All-Share
4,410.51
13:30 26/04/24
FTSE Small Cap
6,456.59
13:30 26/04/24
General Retailers
3,876.92
13:29 26/04/24
The dramatic falls in profits and a boardroom coup has left the company struggling, reporting losses of £491.5m, the largest in its history, in October.
The company entered talks with its lenders last week after weak sales over Christmas and the department store has already announced it would be closing 50 of its 165 stores in the UK and Ireland.
The firm has reportedly selected a further 30-40 stores to join the shutdown which would lead to a loss of approximately 10,000 jobs, the Daily Telegraph reported on Monday.
Mike Ashley, whose Sports Direct owns almost 30% of the company, last week blocked the re-appointment of chairman Sir Ian Cheshire and voted chief executive Sergio Bucher off the board at the company's annual shareholder meeting.
Ashley teamed up with Landmark Capital in a boardroom coup which made Debenhams stock fall even lower.
Earlier last week, Bucher, who will remain as CEO and report to the board, said the company had begun talks with lenders about its £286m of net debt and could look at a possible company voluntary agreement (CVA) with landlords to cut property costs.
Debenhams stock was down another 8% on Monday to 3.61p, not too far from its pre-Chrismas all-time low of 3.12p.