Debenhams stores will remain open for now despite administrators saying they have “regretfully” started its liquidation process.
The chain’s 124 stores will continue trading to clear current and contracted stock.
However, once this process is complete and if no new offers are received, all stores will shut with the loss of around 12,000 jobs
“On conclusion of this process, if no alternative offers have been received, the UK operations will close,” the company said in statement.
The 242-year-old retailer has a large store inside Aberdeen’s Trinity Centre.
Debenhams also a store at the Eastgate Shopping Centre in Inverness.
Hopes of a rescue bid from JD Sports evaporated this morning after the sportswear brand confirmed it had pulled out of talks.
In a brief statement to the London Stock Exchange, the company said: “JD Sports Fashion, the leading retailer of sports, fashion and outdoor brands, confirms that discussions with the administrators of Debenhams regarding a potential acquisition of the UK business have now been terminated.”
The brand has already cut 6,500 jobs across its operation due to heavy cost-cutting after it entered administration for the second time in 12 months.
Hilco, a firm which specialises in winding up retailers, is reportedly planning to go into stores tomorrow to start clearing stock.
It comes just hours after it was confirmed Arcadia, the group behind TopShop, Burton and Dorothy Perkins collapsed into administration.
It is understood that the collapse of the deal with JD Sports is partly linked to the administration of Arcadia, which is the biggest operator of concessions in Debenhams stores.
Geoff Rowley of FRP Advisory, joint administrator to Debenhams and partner at FRP, said: “All reasonable steps were taken to complete a transaction that would secure the future of Debenhams.
“However, the economic landscape is extremely challenging and, coupled with the uncertainty facing the UK retail industry, a viable deal could not be reached.
“The decision to move forward with a closure programme has been carefully assessed and, while we remain hopeful that alternative proposals for the business may yet be received, we deeply regret that circumstances force us to commence this course of action.
“We are very grateful for the efforts of the management team and staff who have worked so hard throughout the most difficult of circumstances to keep the business trading.”
Scottish Conservative north-east MSP Liam Kerr said: “The prospect of Debenhams closing is a catastrophic blow to Aberdeen in the run-up to Christmas, which should have been a busy time for the department store.
“My thoughts go to the hard-working staff who have been placed in this terrible situation through no fault of their own.
“Debenhams is a massive department store which has been in the city for more than 35 years and it’s unthinkable for its legacy to end.
“The store has a fond place in the hearts of many and I really do hope it can be saved.
“Covid has hit Aberdeen extremely hard and this is another illustration of why our retail sector and shopping centres such as the Trinity need more support to ensure doors can be kept open.