Warning issued to shoppers as Debenhams shares are suspended

Debenhams department store in Ipswich town centre

Debenhams department store in Ipswich town centre - Credit: Archant

Suffolk shoppers have been warned to use any Debenhams gift vouchers as soon as possible or risk losing the money.

Debenhams department store in Ipswich town centre

Debenhams department store in Ipswich town centre - Credit: Archant

Earlier today (Tuesday, April 9) the struggling retail giant suspended its shares as it rejected another bid to escape administration.

And the development prompted Suffolk Trading Standards to issue a warning to shoppers across the region.

A spokesman for the watchdog said: “With news that Debenhams are on the brink of administration, we would advise that if you gave any gift vouchers, and are able to get to a store, you should spend them as soon as possible.”

MORE: Then and now: Ipwsich’s lost pubs The retail giant has a number of branches across Suffolk and Essex, including Ipswich, Bury St Edmunds and Colchester.

Sports Direct billionaire Mike Ashley made yet another bid to rescue offer to save the firm from administration, only to see it rejected and shares suspended an hour later.

The offer involved underwriting a rights issue which would see existing investors buying newly issued shares and is an advance on an £150 million plan tabled on Monday, which was rejected.

Under Mr Ashley’s latest proposal, Debenhams’ lenders would have to agree to write off £82 million of its £720 million debt mountain, as well as install the tycoon as chief executive.

Lenders to Debenhams said the latest proposal, on the terms set out, was “not sufficient”.

UPDATE: Debenhams enters administration

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A spokesman for Debenhams :”The board confirms that it received a revised, highly-conditional, proposal from Sports Direct in the early hours of 9 April, which indicated a willingness of Sports Direct to underwrite an equity issue of £200 million.

“The company’s lenders have confirmed to the company that the proposal, on the terms set out, was not sufficient to justify an extension to the April 8 deadline.

“The company anticipates making a further announcement during the course of the day following further discussions with its lenders.”

Debenhams is now widely expected to fall into administration and the retailer’s lenders seize control of the company in a move tipped to trigger store closures and job losses.

Shareholders such as Mr Ashley’s Sports Direct, which holds a 30% stake, will also see their investments wiped out.