Department store giant Debenhams is on the brink of collapse after filing a notice of intent to appoint administrators, affecting around 22,000 workers.

In a statement, Debenhams said: “Department store group Debenhams today has filed a Notice of Intent to appoint an administrator in the UK.

“This move will protect Debenhams from the threat of legal action that could have the effect of pushing the business into liquidation while its 142 UK stores remain closed in line with the government’s current advice regarding the Covid-19 pandemic.

“The group is making preparations to resume trading its stores once government restrictions are lifted.”

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Debenhams said it has the support of its lenders to enter administration and is engaging with employees and suppliers over the move.

The majority of its employees in the UK are currently being paid under the Government’s furlough scheme, after its stores closed following the shutdown of non-essential stores.

It added that it continues to trade online across the UK, Ireland and Denmark and customer orders, gift cards and returns are being accepted and processed normally.

The store said it has the support of its lenders. Credit: PA

The historic retailer has closed 22 shops in recent months as part of plans to shut 50 sites and bring its total estate to 110.

The announcement comes amid reports that Cath Kidston is also set to appoint administrators, while rival Laura Ashley has said it will permanently close 70 stores after sliding into administration.

Julie Palmer, partner at Begbies Traynor, said: “Debenhams has been in financial difficulties for a while so this doesn’t come as a major surprise, but it will leave its 20,000-plus strong workforce in a precarious position who will struggle to get new employment during the ongoing uncertainty.”