Oldham Debenhams dodges first wave of store closures

The Debenhams store in Oldham

The first of the 22 Debenhams store closures have been announced and the Oldham branch in Spindles Shopping Centre isn't on the list.

It had been hoped a rescue package from the owner of Sports Direct, Mike Ashley, could save the struggling department store Debenhams, however it’s been announced his latest package, worth around £200 million, has been rejected by lenders.

On Tuesdsay 9th April, shares in the company were suspended with Debenhams rejecting the latest offer from Ashley.

The department store chain, which has 165 UK stores including in Spindles Shopping Centre in Oldham, is on the verge of entering a so-called pre-pack administration as part of its deal with lenders to keep it afloat.

But Mr Ashley, whose Sports Direct empire owns 30% of Debenhams, has been battling to avoid such an outcome, which would see this stake wiped out.

Debenhams has spurned a series of offers from the tycoon - all of them conditional on him being installed as its chief executive.

Mr Ashley, who had a £150 million bid rejected on Monday 8th April, upped the ante again in the early hours of the following morning, offering to underwrite a rights offer - a way of raising cash from shareholders - to the tune of £200m instead.

The offer was conditional on lenders agreeing to write off £82m of its £720m debt mountain - less than Mr Ashley had previously asked for.

But Debenhams confirmed its lenders had rejected the latest deal from the retail giant, who also owns Newcastle United Football Club, saying it was "not sufficient to justify an extension" to the refinancing deadline for the business.

Debenhams said this would "ensure the stability and continuing trading of the group's operating subsidiaries, with no disruption to the group's business, customers, employees, pension holders, suppliers or operations".

In total the chain looks to close 50 of it's stores across the UK and 22 will shut initially, but it has indicated this won't not be before Christmas 2019.

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