Debenhams has placed its 11-strong chain in Ireland into examinership as part of attempts to secure it long term future.
The Irish arm of the UK retailer racked up losses of €6.7m last year, blaming disproportionately high operating costs, such as above-market rents and other overheads. Its parent firm said this week that it was no longer willing to financially support the business unless a radical restructuring took place.
Kieran Wallace of KPMG was appointed interim examiner by the High Court in Ireland yesterday. Under Irish Law the examinership process provides court protection to enable the Examiner of Irish companies to put together a Scheme of Arrangement with creditors, with a view to allowing the company to trade as a sustainable business into the future. It is estimated the process will last up to 100 days.
Debenhams said that all 11 stores and its online operations would continue to trade as normal during the examinership process which aims to facilitate the restructuring its operations to create a “competitive and sustainable business” in Ireland.
John Bebbington, Director at Debenhams Retail (Ireland), commented: “The Directors will work hard to secure the long term future of the business in Ireland, enabling us to continue to serve our customers well, to provide sustainable jobs for our colleagues and to support the Irish economy. A key element of the examinership would be to protect as many jobs as possible. We believe this will be in the best long term interests of all our stakeholders.”
- Irish Examinership legislation reflects the pro-active self-help provisions of U.S. Chapter 11 type protection afforded to companies and is less restricting than UK company law
- Suppliers affected should initially check out details here