Debenhams’ creditors have backed a turnaround plan for the collapsed department store chain that will see the closure of around 50 stores.
In an announcement after the market closed on Thursday, the company said its company voluntary arrangement (CVA) had been accepted by a majority that was “significantly above” the required threshold of 75% on each proposal.
READ: Debenhams to remain in the hands of lender consortium as administrator fails to find suitable buyer
"I am grateful to our suppliers, our pension stakeholders and our landlords who have overwhelmingly backed our store restructuring plans," said executive chairman Terry Duddy.
He added that the company would work to preserve “as many stores and jobs as possible” during the process.
Twenty-two of the company’s 166 stores are already due to begin closing this year, potentially resulting in the loss of thousands of jobs. The group is also trying to reduce rents on most of its remaining stores.
The approval of the CVA plans followed news earlier on Thursday that a consortium of lenders had retained control of Debenhams after its administrators had failed to find a suitable buyer for the business.
Celine UK NewCo 1 Ltd, an entity which represents the consortium, said at the time that it had £200mln in fresh funding and was “a committed long-term owner” for the business.
Debenhams collapsed into administration last month under the weight of a £720mln debt pile and was placed under the control of Celine by its administrators.
The group has also joined a number of high-profile bankruptcies on the high street as online shopping, rental payments, and lower customer footfall have all put pressure on the sector.
The pain is likely to be particularly acute for Ashley, who tried multiple times to install himself as chief executive of the chain through a takeover bid and a £200mln lifeline offer that Debenhams rejected.