Debenhams' pension schemes ‘carrying on as usual’ despite administration

Debenhams Pension Schemes will be “carrying on as usual”, despite Debenhams falling into administration today, 9 April 2019, it has said.

A spokesperson for the schemes said that members can be “reassured” after the employer of the schemes, Debenhams Retail Limited, has been transferred to a newly incorporated company which “continues to trade and operate as normal”.

Administrators were appointed to the firm today after they failed to reach an agreement with lenders beyond the £200m agreed at the end of March.

A spokesman for the Debenhams Pension Schemes said: “The trustees have been informed that Debenhams plc has been placed into administration. Debenhams plc is not the sponsoring employer of the schemes.

“The relevant employer for the schemes is Debenhams Retail Limited. Debenhams Retail Limited has been transferred to a newly incorporated company and continues to trade and operate as normal. Members can therefore be reassured that the schemes are carrying on as usual.”

The spokesperson added that it has been working closely with The Pensions Regulator and the Pension Protection Fund at every stage.

“We are in the process of writing to all members with further information, and we will continue to keep them informed,” they added.

In March, the group reached a £200m refinancing agreement with lenders which will allow to trade as normal while it undertakes a restructure in the hope of saving the company.

Debenhams chairman, Terry Duddy, said: "We remain focused on protecting as many stores and jobs as possible, consistent with establishing a sustainable store portfolio in line with our previous guidance.

"In the meantime, our customers, colleagues, pension holders, suppliers and landlords can be reassured that Debenhams will now be able to move forward on a stable footing. I would like to thank them all for their recent and continuing support."

According to the BBC, the group rejected a £150m offer from Sports Direct owner, Mike Ashley, after he wanted to be chief executive of the company.

Commenting on the news, Lincoln Pensions managing director, Alex Hutton-Mills, said: “In terms of the Debenhams pension scheme, this is a very good example of where the trustee board has worked collaboratively alongside the regulator, PPF and the sponsor to ensure members’ interests have been protected on what is a very unfortunate day for the retail sector.

“It will be interesting to see if any buyer or refinancer will wish to acquire the scheme at the next stage of the financing. Only time will tell.”

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