Debenhams Goes Into Administration

Published on: 9 Apr, 2019
Updated on: 12 Apr, 2019

by Hugh Coakley

Sales of Debenhams Plc shares were suspended this morning followed by the announcement that administrators had been appointed.

This is likely to mean the closure of around 50 of its 166 stores. The company has not said which stores will close.

Debenhams was part owned by Sports Direct owner, Mike Ashley, who unsuccessfully tried to take charge of the ailing company.

The Guildford branch continued to trade normally today. At one stage the lights went out in the store and a customer commented as a joke: “Have they just been declared bankrupt?”

One member of staff said that they had been told nothing officially about the situation or whether Guildford was one of the stores expected to close but agreed that the situation was worrying.

Like many high street retailers, Debenhams has been struggling against on-line competition. It has also built up a huge debt, which it had used to finance expansion from the 120 stores it had in 2006, and suffered a loss of nearly £0.5bn in 2018.

Terry Duddy, Debenhams’ Chairman, said: “We remain focused on protecting as many stores and jobs as possible, consistent with establishing a sustainable store portfolio.

“In the meantime, our customers, colleagues, pension holders, suppliers and landlords can be reassured that Debenhams will now be able to move forward on a stable footing.”

Debenhams on the Wey occupies a prime site in the town centre and redevelopment as housing could be an option were the store to close.

The Guildford store on the banks of the River Wey opened in 1968 as Plummers. The full name of the business then was Plummer Roddis but, at the time of opening, it had already been taken over by the Debenhams group. It was renamed Debenhams in 1974.

The site is understood to be owned by property company M&G, which is the council’s partner for redeveloping the North street area. Development as 50 houses was raised as an option in Guildford’s Strategic Housing Land Availability Assessment in 2013 and this plan could be reconsidered in the light of today’s events.