David Jones enters administration, store closures expected before Christmas as lenders and landlords fail to agree
David Jones, a 188-year-old retailer, has entered administration for the first time as its board appointed McGrathNicol as voluntary administrators.
FTI Consulting has been appointed as receivers to manage the business until it can be restructured and sold.
The company’s landlords failed to agree on rent terms, prompting the administration.
David Jones is expected to release statements to staff later today, and FTI will update on closures and job losses soon.
Closure impact
Stores at several major shopping centres including Westfield Parramatta and Carindale in NSW, are likely to close, as earlier reported by smh.com.au.
The collapse will result in significant losses for Anchorage Capital and unsecured creditors like gift voucher holders and suppliers.
Disagreements with major landlord Scentre Group, which operates 17 shopping centres with David Jones outlets, were a key factor in the collapse.
David Jones rejected a Scentre Group restructuring proposal, having not paid rent since October.
Scentre Group CEO Elliott Rusanow expressed disappointment over Anchorage Capital’s rejection of an offer to keep David Jones trading.
The retailer’s restructuring included closing nine stores and exchanging $45 million in bank guarantees for equity.
