Debenhams will this week reveal it has bagged a cash injection from lenders as the struggling department store closes in on a radical restructuring plan.
The embattled chain has been in discussions with lenders over recent weeks as it looks to refinance banking facilities over the next 12 months in a bid to stay afloat.
The retailer will announce it has secured a lifeline from lenders, while a debt for equity swap remains under consideration, sources told the Sunday Telegraph.
The revelation comes amid reports the department store is planning to launch a company voluntary arrangement (CVA) with administrators KPMG.
The CVA, which has been used by other major retailers including Homebase and New Look, would enable the company to close stores and negotiate rent reductions.
The proposed arrangement could be brought in before the firm’s next rent payment in March and will lead to up to 20 store closures this year, according to the Sunday Times.
Shares in Debenhams have slumped in recent months as declining sales and hefty rent bills eat away at profits. The retailer has earmarked as many as 90 of its high street stores for closure, putting 10,000 jobs at risk.
Sports Direct billionaire Mike Ashley, who holds a 30 per cent stake in Debenhams, has also been making waves at the company as he eyes a possible takeover.
Earlier this month Ashley led a dramatic boardroom coup, ousting chairman Ian Cheshire and pushing chief executive Sergio Bucher off the board.
Debenhams declined to comment on its restructuring plans.