LONDON, United Kingdom — Debenhams secured a lifeline from some of its lenders, giving the troubled UK department store £40 million ($51.5 million) in liquidity as it attempts a broader refinancing.
The company also announced an agreement with export and logistics company Li & Fung on a sourcing partnership for Debenhams own-brand products. The deal “will help us anticipate and respond more quickly to trends and our customers’ preferences, as well as delivering better quality product,” chief executive Sergio Bucher said in a statement Tuesday.
Debenhams, laden with debt, has been caught up in the sweeping decline of the UK’s traditional downtown retailers. Billionaire investor Mike Ashley, who has a stake in the company, last month engineered a shareholder-vote coup in which he forced out Debenhams chairman Ian Cheshire and drove Bucher off the board.
The new secured credit facility will initially pay interest of Libor plus a 5 percent cash coupon annually, and will be secured over the assets of the existing guarantors of its revolving credit facility and notes.
By John J. Edwards III; editor: Eric Pfanner.