Debenhams secures £40 million funding boost
Debenhams has secured a £40 million cash injection following talks with its lenders.
In a statement the department store chain said the facility agreement, which contains provisions for a step-up in pricing during the second quarter of the year, will “act as a bridge to facilitate a broader refinancing and recapitalisation”. Debenhams is also planning to conclude a comprehensive refinancing by the end of the period.
Sergio Bucher, Debenhams chief executive, said: "Today's announcement represents the first step in our refinancing process. The support of our lenders for our turnaround plan is important to underpin a comprehensive solution that will take account of the interests of all stakeholders, and deliver a sustainable and profitable future for Debenhams.”
Debenhams has also announced that its has entered an agreement in principle with supply chain solutions company Li & Fung to develop a strategic sourcing partnership as part of plans to make operational improvements to support its turnaround strategy. The retailer said the agreement is expected to cover a “material part” of its own-brand sourcing and will help it to achieve improved product quality and lead-times, higher margins and better working capital efficiency.
Speaking of the partnership, Bucher added: “It gives us access to state-of-the-art technology in the LF Digital platform, providing end-to-end visibility across our supply chain. This will help us anticipate and respond more quickly to trends and our customers' preferences, as well as delivering better quality product."
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