Department store Debenhams is on the brink of administration for the second time in a year, the company has confirmed.
With 142 UK stores closed and the majority of the 22,000 staff on furlough, the current owners want to push the business into administration then buy it back debt-free.
The department chain has five stores based in shopping centres in Northern Ireland: Belfast’s CastleCourt, Craigavon’s Rushmere, Derry’s Foyleside, Ballymena’s Fairhill and The Quays in Newry.
Debenhams explained: "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 company, which has filed a notice of intent to appoint an administrator, added it is making preparations to open again once Government restrictions are lifted.
"The group is preparing to enter a 'light touch' administration that will see the existing management team remain in place under the direct control and supervision of the administrators," it said.
The majority of its employees in the UK are currently being paid under the Government's furlough scheme, after its stores closed following the shutdown of non-essential shops.
Debenhams’s 11 stores in the Republic are also closed due to the same trading restrictions as the UK, with employees furloughed under the Irish government scheme.
It 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.
Debenhams said it has the support of its lenders to enter administration and is engaging with employees and suppliers over the move.
