Debenhams has denied that lenders are getting cold feet over a debt for equity swap, amid reports that the retailer’s restructuring plans are dependent on further rent cuts from landlords.
Lenders to the department store agreed to a £100m debt for equity swap last April when Debenhams entered a pre-pack administration.
The Sunday Times reported that landlords had been told lenders would only sign off debt restructuring if they agreed to further rent cuts, however, Debenhams has denied this claim.
A spokeswoman from Debenhams said: “The commitment of Debenhams’ lenders to a debt for equity swap is not in question. The business is now in a position to proceed with the final phase of its balance sheet restructuring, to include the write-down of at least £100m of debt, as was announced in April 2019.
”The precise timing and location of any further store closures will depend on our continuing negotiations with landlords and councils to determine whether rent and rates bills can adjust to more realistic levels reflecting today’s retail market conditions.”
It is understood that any further Debenhams store closures will not happen until at least 2021 and are still expected to be in line with the original closure guidance of 50 shops.