DEPARTMENT store group Debenhams has gained some breathing space over repaying its £1bn debt burden.
Newspaper reports said the company, which has 135 stores, has renegotiate the terms of its debts with lenders to give itself longer to pay off the borrowings, newspaper reports said.
It is believed that the retailer – said to be paying more than £5m a month in interest – needed the extra leeway in a difficult trading environment to head off the risk of breaking some of its banking covenants.
Debenhams was floated on the stock market 18 months ago – netting big profits for a private equity consortium of CVC, TPG and Merrill Lynch, which took the group private in December, 2003.
But the owners massively increased the group’s debt burden, making it less attractive to institutional investors on its return to the stock market. Shares are now below £1 – less than half the level of May, 2006.
