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Bloomberg
Struggling UK retailer Debenhams Plc moved to protect itself from creditors after closing its stores because of the coronavirus.
The department-store chain filed a notice of intent to appoint administrators under UK insolvency procedures. The company said the goal was to avoid being pushed into liquidation as it eyes reopening after virus-related restrictions are eased.
Debenhams envisions what it described as a “light touch†administration in which the existing management remains in place, under the supervision of the administrators from FRP Advisory Group Plc.
The company was taken over by lenders last year, making it one of the UK’s highest-profile retail casualties as shoppers shift online. The move came after the department-store chain rejected a rescue plan from retail tycoon Mike Ashley.
Debenhams has 142 stores in the UK but it has been shutting some outlets as it tries to reduce its high rental costs and property taxes amid falling customer traffic and shaky consumer confidence. This month’s virus-
induced lockdown has deepened its crisis.
Thousands of workers have been furloughed, meaning most of their salaries are paid by the government, though the retailer has continued to sell online.