Debenhams scrambling to secure a lifeline from its lenders in a desperate bid to survive
Debenhams was scrambling to secure a lifeline from its lenders last night in a desperate bid to survive.
The department store chain had hoped to announce progress last Friday but investors were left in the dark and expected an update this morning. However, the Mail understands this could be pushed back to late today or later in the week.
The shifting deadlines will only fuel fears over the future of the High Street chain, which issued three profit warnings last year and has £286m worth of debt.
Uncertainty: The shifting deadlines will only fuel fears over the future of the High Street chain
Its current lending arrangements are set to expire next year, and Debenhams is aiming to grab the lifeline from banks and bondholders before it settles a potentially crippling rent payment, due on March 25. Talks with creditors are ongoing. Debenhams is also working on a controversial Company Voluntary Arrangement (CVA) which would allow it to negotiate chunky rent reductions with landlords and axe a number of stores.
But it can only suggest a CVA if it has a strong reason to. It hopes to make the new debt agreement dependent on a CVA, meaning landlords would have to agree to cut rents if they wanted it to use its debt package and survive.
If Debenhams does not strike a new lending package or a CVA, it could fail to pay its bills and even fall into administration.