Debenhams moves to bolster liquidity with £35m equity raise

(Sharecast News) - Boohoo owner Debenhams said on Tuesday that it plans to raise fresh equity as part of an effort to support its turnaround strategy and strengthen its balance sheet. Debenhams, which was renamed from Boohoo last year, said it was preparing a £35m fundraise to boost liquidity, with co‑founder Mahmud Kamani, chief executive Dan Finley and non‑executive director Iain McDonald all expected to participate.

The AIM-listed group added that it was also in advanced talks with its lending syndicate over additional financial flexibility.

Debenhams also reiterated that it remains on track to deliver adjusted underlying earnings of £50m for the year to the end of February and said it was continuing to to explore options to support an "asset‑lite" model, including potential disposals of non‑core assets, supply‑chain partnerships, strategic IP licensing and other financing routes.

Lease expenses were expected to fall from £17m this year to around £13m next year, with a further reduction to follow once a vacant US property lease expires. Capital expenditure was also set to halve to about £8m after £16m was invested over the past year.

"As a result of this simplification of the group's business, the planned fundraise, the continued focus on improving and growing the asset-lite marketplace model, and the resulting impact of significantly improving the group's cash generation, the directors remain confident in the outlook for full-year 2026 and full-year 2027," said Debenhams.

As of 0840 GMT, Debenhams shares were down 8.44% at 20.60p.

Reporting by Iain Gilbert at Sharecast.com