Debenhams set to close after JD Sports pulls out of rescue talks

1 December 2020, 09:11 | Updated: 1 December 2020, 23:05

JD Sports has pulled out of the Debenhams rescue deal
JD Sports has pulled out of the Debenhams rescue deal. Picture: PA

By Maddie Goodfellow

Debenhams is set to close after JD Sports pulled out of a potential rescue deal, putting 12,000 jobs at risk.

Debenhams has confirmed that its administrators FRP Advisory will start a wind-down of the business whilst continuing to seek offers for all or parts of the business.

"On conclusion of this process, if no alternative offers have been received, the UK operations will close," the company said in statement.

On Tuesday, shoppers for the retailer were left waiting in a virtual queue as demand overwhelmed the website following a 70 per cent 'fire sale'.

Debenhams set to close putting 12,000 jobs at risk

JD Sports pulled out of the potential rescue deal after Arcadia tumbled into insolvency on Monday evening, casting a shadow over its own 13,000 workers and 444 stores.

12,000 jobs are now at risk at Debenhams, which operates 128 UK stores, many of which are currently closed due to the coronavirus crisis.

The 242-year-old retailer already cut 6,500 jobs across its operation due to heavy cost-cutting after it entered administration for the second time in 12 months.

The business has been a staple of the British High Street
The business has been a staple of the British High Street. Picture: PA

JD Sports was understood to be the sole entity left in a sale process.

But the sportswear chain was said to be concerned by the collapse on Monday night of Debenhams' biggest supplier, Sir Philip Green's Arcadia Group.

It's understood staff were told this morning, and restructuring firm Hilco, is expected to start going into stores tomorrow to begin clearing stock.

JD Sports' update to the City read: "JD Sports Fashion, the leading retailer of sports, fashion and outdoor brands, confirms that discussions with the administrators of Debenhams regarding a potential acquisition of the UK business have now been terminated."

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."

Retail expert explains what has led to Arcadia's fate

In a statement on his Twitter, Labour leader Keir Starmer said: "Thousands of Debenhams staff and their families face huge uncertainty this Christmas.

"Retail workers across the country will be worried about the future.

"Our high streets face a defining few months. We must fight to protect good jobs and good businesses."

Paddy Lillis, general secretary at the Usdaw retail union, said: "It is devastating news for our high streets that Debenhams' administrators have announced a closure programme.

"Throughout Debenhams' difficulties the company and then administrators have refused to engage with Usdaw, the staff are being treated appallingly, and we don't believe the law has been complied with in the past.

"Over 200,000 retail job losses and 20,000 store closures this year are absolutely devastating and lay bare the scale of the challenge the industry faces."

More Latest News

See more More Latest News

Russia is prepared to launch a flurry of cyber attacks on Britain and other NATO members to weaken resolve in support for Ukraine, minister Pat McFadden is set to warn the alliance.

Russia 'prepared to bash Britain with massive cyber attack', ministers to warn NATO conference

Exclusive
Singer Kate Nash says she has joined adult content site OnlyFans to sell 'pictures of [her] arse' in an interview with LBC's Natasha Devon.

'Sex work is really empowering': Singer Kate Nash tells LBC why she sells photos on OnlyFans

The UK is on a 'slippery slope to death on demand', Justice Secretary Shabana Mahmood has said in a letter to constituents.

'Slippery slope to death on demand': Justice Secretary details concern over assisted dying debate

Novak Djokovic has appointed Andy Murray as his coach for the Australian Open.

Andy Murray to coach old rival Novak Djokovic at Australian Open after retiring in August

Island nations which are vulnerable to climate change and some African countries have stormed out of COP29 in a row over funding.

Negotiators from climate-vulnerable nations walk out of COP29 in row over funding deals

Putin has said he will fire more of Russia 's new hypersonic missiles at targets in Ukraine

Kremlin warns 'a collision between the nuclear powers' is imminent as West fires missiles into Russia

Coleen Rooney on I'm A Celeb

'Wagatha Christie strikes again': Coleen Rooney uncovers I'm A Celeb secret as she calls out campmates

Chloe Barlow is one of the small business owners who will be affected by the change

'It's a mess': Small businesses hit out at EU red tape set to cost thousands, and say 'government has been no help'

Foreign tourists ride on boat in a river in Vang Vieng

Laos government 'saddened' by deaths of tourists in Vang Vieng which include South London woman

Leading brands are dumping Captain Tom Moore’s daughter Hannah Ingram-Moore

Top brands distance themselves from Captain Tom’s daughter after she cashed in on her father's legacy

Euston station has reopened

Euston station reopens after bomb squad carry out 'controlled explosion'

At least 11 people have been killed and more than 60 injured, Lebanon's health ministry has stated

Huge Israeli air strikes hit residential building in central Beirut, killing at least 11 people

Homebase was waiting on around £5 million of tax rebates before collapsing into administration

Full list of Homebase stores up for sale after chain collapses into administration

Live
Storm Bert has hit the UK

Live: Three dead as Storm Bert claims first victims as two die in car crashed and another is crushed by tree

The late Queen and Donald Trump

Queen Elizabeth found Donald Trump to be 'ignorant and hurtful' after Princess Margaret remark

Storm Bert has begun to make an impact with snow closing roads

Trains, planes and roads in chaos as Storm Bert sweeps UK with 82 mph winds and heavy snow