240 year old Debenhams department store chain will shut down, 12, 000 may lose jobs

The Debenhams department store chain is to be shut down post Christmas, with the loss of up to 12,000 jobs and closure of 124 stores in a new blow to the high street.

The liquidation of the 240-year-old business came just a day after Philip Green’s Arcadia group, the owner of brands including Topshop, Miss Selfridge and Wallis, collapsed into administration. A total of 25,000 jobs are now at risk at the two companies, which were once part of the Burton Group.

The demise of the department store chain will hit many towns across the UK, as the shops are anchor tenants in numerous shopping centres and key attractions on high streets.

Alongside Arcadia, a host of other established high street names are in trouble, battered by the twin problems of lockdowns and a shift to online retailing which has accelerated rapidly this year. Edinburgh Woollen Mill plus Peacocks and Jaeger are among the names which have collapsed in recent weeks.

Debenhams will launch a massive stock clearance sale at 7am on Wednesday morning as non-essential shops in England are allowed to reopen for the first time in four weeks.

The department store traces its roots back to 1778 when William Clark established a drapers store on Wigmore Street in the West End of London. Its current name stems from 1813 when William Debenham invested in the company, which became Clark & Debenham.

Debenhams had been in rescue talks with JD Sports. But the sports retailer pulled out of the talks when Arcadia went under. Arcadia operated more concessions in Debenhams than any other retailer and Arcadia is believed to have sold about £100m of clothing a year via Debenhams shopfloors.

JD confirmed the decision on Tuesday morning in a statement that said “discussions with the administrators of Debenhams regarding a potential acquisition of the UK business have now been terminated.”

With the exit of JD Sports, the only remaining suitor likely to take on a significant number of stores is Mike Ashley’s Frasers Group.

Ashley has made no secret of his interest in the ailing department store despite seeing a £150m stake he built up in the then listed company wiped out last year in a debt restructuring deal with the department store’s lenders.

However, Ashley’s offers for the business have so far not exceeded half of the £300m price hoped for by its owners.

Big chains including Next, John Lewis and Marks & Spencer are expected to take a look at prime Debenhams sites, but many could be broken up into smaller stores or redeveloped for other uses, resulting in significant changes on high streets around the country.