Department street chain Debenhams announced this morning that it is preparing to close down after failing to attract a buyer, but the former high street giant’s problems stretch back over several years.
Earlier this year the struggling retailer entered administration for the second time in 12 months, even before Covid-19 forced it to close its stores for months at a time.
When administrators announced this morning that the company will be wound down, it had already permanently closed more than 20 shops and axed more than 6,500 jobs since the coronavirus pandemic took hold of the UK in March.
The events leading to Debenhams’ collapse
2018: Debenhams reports a record breaking pre-tax loss of £491.5m.
April 2019: The retailer falls into administration for the first time and is immediately bought by a consortium of investors.
The firm is taken private in the rescue deal, wiping out shareholders including Sports Direct’s Mike Ashley, who has by this point built up a significant stake in the firm.
May 2019: Creditors give Debenhams their approval for company voluntary agreement, paving the way for store closures and rent reductions.
Some landlords launch legal action against the retailer following the approval of the restructuring agreement, which is funded by Mike Ashley.
September 2019: Debenhams wins the High Court battle with landlords to push through its CVA proposals.
23 March 2020: First coronavirus lockdown begins, Debenhams closes all of its stores alongside other non-essential retailers
April 2020: Debenhams enters “light-touch” administration, allowing management to stay on board to turn the ship around.
August 2020: The department store makes 2,500 employees redundant over the summer due to the impact of Covid-19, bringing the total number of job cuts since the beginning of the pandemic to 6,500.
September 2020: Reports suggest that Debenhams’ owners have drawn up contingency plans in case a buyer for the department store is not found.
18 October 2020: Mike Ashley launches improved bid for Debenhams, according to the Sunday Times, after frontrunner Mukesh Ambani, who owns Reliance Retail, pulled out of the race.
5 November 2020: Another England-wide coronavirus lockdown begins and non-essential retailers are forced to close for a second time this year – this time in the crucial Christmas trading period.
24 November 2020: JD Sports revealed to be in exclusive talks with Debenhams over a potential deal
30 November 2020: Arcadia appoints administrators, raising concerns that JD Sports could pull out of a deal to buy Debenhams
1 December 2020: JD Sports terminates discussions with Debenhams, administrators announce plans to liquidate the company.