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Debenhams to close as domino effect from Arcadia’s collapse hits


Arcadia’s brands were the biggest concession operator at the department store group

Debenhams’ department stores are set to close after  () said its talks to rescue the ailing retailer had terminated. 

This followed the collapse into administration of Sir Philip Green’s Arcadia Group, whose retail brands, which include TopShop, Miss Selfridge and Dorothy Perkins, are the biggest concession holder at the Debenhams, accounting for around 5% of annual revenues.

In its second administration of recent years, Debenhams has been looking for a buyer but private equity owners Silver Point Capital could not agree on a price with JD nor Mike Ashley’s  ().

Failure of the JD talks means that restructuring firm Hilco is likely to take charge of a break-up of the group, according to reports.

Debenhams and Arcadia employ over 25,000 staff between them.

Shares in JD were up 3% to 797.6p on Tuesday morning, while Frasers’ were more than 4% higher at 440.72p.

The lack of potential competition saw  () and Next () both rising 1%, while online specialist Boohoo (), which City speculators suggest is likely to be interested in Arcadia’s brands, was up 2%.

Susannah Streeter, senior investment and markets analyst, at Hargreaves Lansdown said: “The retail house of cards on the high street is in danger of collapse.

“Shares in Frasers Group and Marks and Spencer rose strongly in early trading with expectations they could be the last big department store chains standing in town centres. Frasers Group is also a strong contender to snap up the distressed brands up for sale.  

“Some of those gains though were erased amid concerns about the wider malaise on the high street. A nightmare before Christmas is unfolding for 25 thousand employees who will lose their jobs if buyers are not found for parts of both businesses.” 



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