Debenhams plc has today confirmed that it has put in place new facilities with its existing lenders. These provide the group with facilities totalling £200m of new money, including £40m to replace the interim borrowing announced on 12 February.
Terry Duddy, Chairman of Debenhams, said, 'We are pleased to have agreed this comprehensive funding package which secures the future of the Debenhams business and provides reassurance for Debenhams' employees, pension holders, suppliers, lenders and other stakeholders.
'We have also preserved a route for our shareholders to participate in the future of the business, but this requires the support of our major shareholder.
'We will now move to the next phase of the restructuring of the business, which includes reducing rents and reshaping our store portfolio, as we have referenced in previous announcements. These actions are necessary to ensure the strongest possible platform to support the business going forward.'
The group has undertaken a thorough review of its store estate in the context of the current and future retail environment and plans to proceed with a restructuring of the estate that, if approved, will result in a significant overall reduction in the group's rent burden. This is a critical component of the group's restructuring plan, and executing this is in part linked to the provision of the facilities.
The possible offer announced by Sports Direct on 25 March 2019 did not provide a solution to the group's immediate working capital needs, and the board could find no way for the group to continue to trade until such time as the offer, if made and successful, had closed.