Debenhams closes seven stores with 422 jobs to go

Debenhams closes seven stores with 422 jobs to go after plunging into administration last week

  • The high street retailer announced it was going in to administration last week 
  • Now it is closing seven stores as coronavirus continues to hit the high street 
  • Stores are closing in locations including Truro, Salisbury and in west London 
  • It has agreed terms with landlords to continue trading at 120 of its 142 UK stores 
  • Learn more about how to help people impacted by COVID

Debenhams has confirmed the closure of seven stores with the loss of 422 jobs after it slid into administration last week.

The department store firm said it has agreed terms with landlords to continue trading at 120 of its 142 UK stores.

It is understood the group is in ongoing talks over the remaining stores and is confident more deals will be secured in the coming days.

Debenhams confirmed that it failed to reach agreement with landlords regarding seven stores which will not re-open after the current lockdown. 

The department store firm said it has agreed terms with landlords to continue trading at 120 of its 142 UK stores (pictured, a store on Oxford Street, London today)

Stefaan Vansteenkiste, chief executive officer of Debenhams, said: ‘I’m delighted with the progress we are making with our landlord discussions which reflects the pragmatic view the vast majority of them are taking of the current market conditions.

‘We have agreed terms on the vast majority of our UK stores and talks are proceeding positively on the remainder, positioning us to reopen these stores when government regulations permit.

‘Regrettably we have been unable to reach agreement on seven stores and these will not be reopening, and I’d like to express my thanks to our colleagues in these stores at what I know is a difficult time for everyone.’

The historic retail entered administration on April 9, appointing FRP Advisory to oversee the process, casting a shadow over the future of its 22,000 staff. 

Around 22,000 jobs could be lost as the fashion brand blames the ‘unprecedented circumstances’ of the coronavirus crisis on a sharp downturn in trade.  

In a statement on last week, the company said: ‘Department store group Debenhams today has filed a Notice of Intent to appoint an administrator in the UK.

High street shops and restaurants lost to coronavirus  

With the High Street struggling to cope with the national coronavirus lockdown, a few have started filing for administration. These include:

Debenhams: 22,000 jobs at risk   

Carluccio’s: 2,000 jobs at risk

Brighthouse: 2,400 jobs at risk

Chiquito: 1,500 jobs at risk

Laura Ashley: 2,700 jobs at risk

Flybe: 2,000 jobs at risk

‘This move will protect Debenhams from the threat of legal action that could have the effect of pushing the business into liquidation while its 142 UK stores remain closed in line with the government’s current advice regarding the COVID-19 pandemic.

‘The group is making preparations to resume trading its stores once government restrictions are lifted.’  

The company, which has been on British high streets for 242 years, put many of its 22,000 workforce on furlough earlier this month after the government’s lockdown measures calling for the shutdown of non-essential stores were introduced 

The majority of its employees in the UK are currently being paid under the Government’s furlough scheme.

The company, added that it continues to trade online across the UK, Ireland and Denmark and customer orders, gift cards and returns are being accepted and processed normally. 

Last week, it said its Irish business – which runs 11 stores with around 1,400 staff – will cease trading as part of the administration. 

Debenhams also went into administration in April last year, wiping out equity investors, including Mike Ashley’s Sports Direct, and is now owned by lenders consortium Celine UK NewCo 1 Ltd.  

The department store, which began as a draper business at 44 Wigmore Street in London 1778, was initially founded by William Clark before William Debenham became a partner in the business in 1813. 

The UK-based Italian food chain confirmed the future of its 71 restaurants and 2,000 jobs was now in jeopardy after it was forced to go into administration last month

In 1818, the company opened the doors to its first store outside London in Cheltenham and by 1950 it was the largest department store in the UK. 

The company has closed 22 shops in recent months as part of plans to shut 50 sites and bring its total estate to 110. 

Carluccio’s last month announced it had gone into administration amid the coronavirus lockdown as rent-to-own giant Brighthouse also collapsed amid the crisis. 

Which Debenhams stores are closing down? 

Debenhams confirmed that it failed to reach agreement with landlords regarding seven stores which will not re-open after the current lockdown.

These stores are located in:

  • Truro
  • Stratford-upon-Avon
  • Salisbury
  • Westfield, West London
  • Warrington
  • Leamington Spa
  • South Shields

Other shops are temporarily closing amid the lockdown. Arcadia, which owns brands including Topshop, Miss Selfride, Burton and Dorothy Perkins, confirmed it would be closing its stores amid the coronavirus lockdown. 

Arcadia, which has already furloughed 14,500 out of its 16,500 members of staff, has called in accountants from Deloitte as it is ‘on its knees’, according to the Sunday Times. 

In March, the high-street fashion retailer Next announced that it would be temporarily shutting down all of its 700 UK stores until further notice. 

In the same month the high street giant John Lewis announced they had made the ‘difficult decision’ to close its 50 stores across the UK for the first time in its 155-year history. 

The store, which last saw its flagship store on Oxford Street close after it was bombed in 1940 during the Second World War, confirmed the decision had come about due to the impact of the coronavirus outbreak.   

Meanwhile the British store Cath Kidston also confirmed that they too would be  closing their stores temporarily. 

In a statement to its shoppers last month it said: ‘Cath Kidston is committed to the safety of our customers and employees and so we have taken the difficult decision to temporarily close all Cath Kidston Stores, in the UK & Ireland in response to the COVID-19 pandemic. Stores will close tonight, Saturday 21 March, until further notice. 

‘We are working to ensure our staff receive financial support and the assistance they need throughout this period of closure.

‘We hope that the situation improves quickly for everyone. In the meantime, we’re here for you in these difficult times and send our love to all those affected. Stay safe, keep well and thank you for your unwavering support for our brand’. 

Source: Read Full Article