Filenews 27 January 2021
Debenhams' 242-year history has not stood up enough to keep alive one of the largest and oldest department store chains in the world. A company founded in 1778 in London's West End as a textile shop managed to become the largest retailer in Great Britain with over 200 stores in 18 countries including South Africa, China and Australia. Known mainly for her clothes, Debenhams in her stores also included household items and furniture.
From stock market to bankruptcy
In 1928 the company entered the London Stock Exchange and until 1950 it was transformed into Britain's largest department store chain. From 1985 to 1998 Debenhams was acquired by burton group - which already had Topshop, Dorothy Perkins and other brands that will eventually be converted into the British multinational retail Arcadia Group.
Debenhams is then listed on the London Stock Exchange twice, once in 2003 and once in 2006. In 2003 it was written off by ICE when it was bought by Baroness Retail Ltd, a consortium founded by CVC Capital, Texas Pacific Group and Merrill Lynch Global Private Equity.
The fund's investment yielded $1.2 billion in 2014, up from $1.2 billion in 2014. GBP 600 million. that they had given just three years ago. At the same time, however, the debts, which soared to EUR 1.2 billion, increased. Pounds.
The problems were growing, resulting in the company announcing the biggest losses in its history of EUR 491 million in 2018. and the closure of 50 stores.
Finally, in April 2019, the company declares bankruptcy and its businesses are acquired by a consortium of investors (Silver Point Capital and GoldenTree Asset Management) giving a "breath" of £200m and a new restructuring plan.
In early 2020, the coronavirus pandemic is forcing Debenhams to close all stores. It follows a bankruptcy "rehearsal" and the cut of 2,500 jobs.
Arriving today, online clothing retailer Boohoo announces the purchase of Debenhams for £55m. However, it will not take over any of its 118 physical stores or workforce estimated at 12,000 people.
What went wrong?
The pressure of online shopping, the fall in the British pound, the rise in business taxes and consumer fatigue reflected in reduced shop traffic are some of the reasons retailers have long been under great pressure.
Especially with the pandemic, the presence of consumers in physical stores has decreased and online shopping in Britain has reached about a fifth of retail spending.
Moreover, according to Maureen Hinton of globaldata consultancy who spoke to the BBC, Debenhams as a brand has been left behind in fashion over the past decade, so its inability to diversify has allowed other brands to overcome it.
At the same time, moderate store performance and expensive rents were not dealt with in time, making debts increasingly difficult to cover.
Finally, interesting is the expansion of online players such as Boohoo, which was founded only in 2006 and its value is estimated at 4.4 million euros. Pounds. At the same time, after labour and suffering, the Debenhams value in 2011 was estimated at 1.6 billion pounds.
Source: Capital.gr
