Debenhams to close unless 11th hour buyer found as Top Shop owner is placed in administration in 'worst ever days for High Street'

The retailer said an initial sale process carried out by its administrator FRP Advisory had been unsuccessful.

Geoff Rowley of FRP Advisory, joint administrator to Debenhams and Partner at FRP, said: “All reasonable steps were taken to complete a transaction that would secure the future of Debenhams. However, the economic landscape is extremely challenging and, coupled with the uncertainty facing the UK retail industry, a viable deal could not be reached.

"The decision to move forward with a closure programme has been carefully assessed and, while we remain hopeful that alternative proposals for the business may yet be received, we deeply regret that circumstances force us to commence this course of action.

“We are very grateful for the efforts of the management team and staff who have worked so hard throughout the most difficult of circumstances to keep the business trading. We would also like to thank the landlords, suppliers and partners who have continued to work with Debenhams through this turbulent period and can reassure them that all contractual obligations entered into in the administration period will be met in full.”

The company said that the current trading environment amid the ongoing COVID-19 pandemic meant the outlook for a restructured business was 'highly uncertain'.

The administrators have 'regretfully concluded' that they should commence a wind-down of Debenhams UK, whilst continuing to seek offers for all or parts of the business.

Debenhams will continue to trade through its 124 UK stores and online to clear its current and contracted stocks. On conclusion of this process, if no alternative offers have been received, the UK operations will close. This does not impact Magasin du Nord in Denmark, which continues to operate independently.

The development follows the announcement by the Arcadia Group - the owner of Derry-based clothing outlets Top Shop and Top Man - that it has been placed in administration.

In a statement released on Monday evening the Arcadia Group confirmed that Matthew David Smith, Daniel Francis Butters, Gavin Maher and Robert Scott Fishman, all of Deloitte LLP, were appointed as Joint Administrators of Arcadia Group Limited on November 30, 2020.

"Matthew David Smith, Daniel Francis Butters and Daniel James Mark Smith, all of Deloitte LLP, were appointed as Joint Administrators of A.G. Clothing Limited, Arcadia Group Fashion Holdings Limited, Top Shop / Top Man Properties Limited, Miss Selfridge Properties Limited, Evans Retail Properties Limited, Wallis Retail Properties Limited, Outfit Retail Properties Limited, Burton/Dorothy Perkins Properties Limited, Redcastle (Holdings) Ltd, Redcastle Finance Ltd, Redcastle (TCR) Ltd, Redcastle (TS/TM) Ltd, Redcastle (Freeholds) Ltd and Redcastle Ltd on 30 November 2020.

"Matthew David Smith, Daniel Francis Butters and Gavin Maher, all of Deloitte LLP, were appointed as Joint Administrators of Zoom.CO.UK Limited, Arcadia Group Brands Limited, Top Shop/Top Man Limited, Top Shop/Top Man (Wholesale) Limited, Top Shop/Top Man (Germany) Limited, Top Shop/Top Man (Trinity) Limited, Miss Selfridge Retail Limited, Dorothy Perkins Trading Limited, Burton Trading Limited, Evans Retail Limited, Wallis Retail Limited and Outfit Retail Limited on 30 November 2020.

"The affairs, business and property of the companies are managed by the Joint Administrators. The Joint Administrators act as agents of the companies and contract without personal liability," it stated.

While the Arcadia businesses have been placed in administration it is likely they will continue to trade over the Christmas period while a buyer is sought.

Retail NI Chief Executive Glyn Roberts said: “These few days have been amongst the worst our high streets have ever seen."

He added: “My real fear is that we will now see a domino effect of retailer and after retailer closing and that process will be extremely hard to reverse. The Executive now faces a huge challenge ahead to address this emergency and needs to consider a ‘Marshall Plan’ financial package to save our local town centres and high streets”

Derry MP Colum Eastwood said: “This is awful news for the workers of Debenhams this morning and is adding to the increased uncertainty that they have faced since April.

“Debenhams must provide answers to their staff for how long they will remain in employment and what support will be offered to them.

“In April I wrote to the Department for the Economy when Debenhams had gone into administration to find out what support the Executive will provide to the workers.

In response, the Department stated that if official notice of redundancies is received, the Department for the Economy’s Careers Service can provide one to one support to all of the employees who are affected.”

He continued: “The loss of Debenhams will have a large impact on the retail offering of Derry. It’s important that the Department for the Economy provide immediate support to protect our regional economy.”

“My office is on hand to assist Debenhams workers at this time.”