Debenhams confirms plans for 35 million pound fundraise

Debenhams Group has confirmed that it is preparing for an equity fundraise amounting to around 35 million pounds as it seeks to build up additional liquidity and the “optimal capital structure”. Chief executive Dan Finley, co-founder Mahmud Kamani, and non-executive director Iain McDonald are set to take part in the fundraise, participating at an issue price of 20 pence per ordinary share of 0.01 pound each.

Institutional shareholders will also be addressed over the coming days, before the fundraise launches. The Debenhams board is in further discussions with its lending syndicate as it looks into securing greater financial flexibility to support its turnaround and growth plans. Revised terms will be conditional on completion of the Planned Fundraise.

In the press release, issued in response to media speculation surrounding the plans, the company said the fundraise is expected to reduce net debt, and may aid in delivering double-digit adjusted EBITDA growth for FY27. For the current financial year, FY26, Debenhams is confident that it can deliver 50 million pounds in adjusted EBITDA, in line with guidance and thanks to the removal of “significant cost” amid a simplification of the business.

The group also offered an update on its ongoing turnaround plan, which it says has now delivered a fixed cost exit rate of 130 million pounds, reduced from 175 million pounds for FY26. This puts the company on track to meet its 100 million pounds target, reflecting its broader pivot to an increasingly asset-lite model, which remains at the core of the turnaround plan.

Debenhams also confirmed that all of its brands were trading profitably on an adjusted EBITDA basis now, including PrettyLittleThing, which it said was no longer being considered as an asset for sale. For the fast fashion label, the group is now exploring several opportunities for working capital management, including strategic IP licensing and supply chain partnerships.