Embattled department store Debenhams has confirmed it is in “advanced negotiations” to secure £150m funding from its lenders just a week after it issued another profit warning.
The company saw a drop in sales for the half year to 2 March, leading it to say the profit expectations it announced in January were “no longer valid”.
Debenhams has already secured a cash injection this year, as in February its lenders gave the company £40m, allowing it to extend its £520m borrowing facilities with banks for another 12 months and seek a longer term investment deal.
Of the £150m funding it is currently seeking, £40m will refinance the money it received in February.
The funding negotiations seem to be a rebuttal to Mike Ashley, who announced he wanted to remove all the directors at Debenhams except for Rachel Osborne and appoint himself to an executive role. Ashley, who owns a 30% stake in Debenhams, pledged that if this were to happen he would step down from his current role as a director and chief executive of Sports Direct. At the time, the department store said it was “disappointed” at his proposal.
A statement from Debenhams said: “Further to the announcement made on 5 March, Debenhams confirms that it is in advanced negotiations with its current lenders about additional facilities of approximately £150m. £40m of these facilities will refinance the £40m bridge facility announced on 12 February.”