Struggling Debenhams calls in KPMG for options


Debenhams shares were down around 17 per cent in early trading amid reports that the struggling chain has called in KPMG to advise it over options.

Debenhams has asked KPMG to help to compile a list of options, which could include plans to hand back excess store space to landlords and a CVA, according to news reports.

Commenting on this development, Neil Wilson, chief market analyst at Markets.com told media: “A CVA is being talked about but given the weakness in the share price and the recent acquisition of House of Fraser, we must consider the possibility that Mike Ashley’s Sports Direct – which has a near 30% stake in DEB – will swoop.

“The rationale for combining the two to create the House of Debenhams is compelling enough. As previously noted, combining the two businesses, reducing overheads and at a stroke removing a key leg of competition, seems like the only viable solution for the two ailing department stores. The fact is the market is screaming for restructuring and consolidation looks a sensible route to take given the well documented structural pressures on the sector.”