The new owners of Debenhams will present plans this week to close 20 of their stores early next year, further impacting the UK's hit roads.
Sky News has learned that over the next 48 hours, Debenhams will launch a Voluntary Business Agreement (CVA) that will provide more than 10% of points of sale to close immediately after this year's holiday season.
The closures include about 50 stores that will be closed over a three-year period. This leaves around 110 stores under the name Debenhams.
The retailer will also seek rent reductions for the remainder of its property as part of a long-awaited plan following a brief break in administration earlier this month.
An announcement is expected on Thursday.
Sources said on Tuesday that the introduction of the CVA – a controversial bankruptcy mechanism used by negotiated retailers – would pave the way for creditor reconciliation next month.
They added that some of Debenhams' landowners would probably be against the CVA, with 75% of creditors being required by their vote value.
The next phase of restructuring the chain will start a few days after the announcement that CEO Sergio Bucher will resign.
According to analysts, well over 1,000 jobs are likely to be jeopardized by the initial closure of branches.
The new owners of Debenhams – a group of banks and hedge funds – have appointed Stefaan Vansteenkiste, managing director of the service company Alvarez & Marsal, as Chief Restructuring Officer.
A financial restructuring that will convert Debenhams '£ 100m debt into new equity is also part of the new owners' plans.
It is expected that Lazard, the investment bank that advised Debenhams' Board in the period leading up to the summoning of administrators, will advise a sales process in the near future.
The rapid collapse of the department store chain triggered a furious reaction from Mike Ashley, the boss of the largest shareholder, Sports Direct International.
Mr. Ashley described the administration of Debenhams as "a national scandal" and demanded the withdrawal.
Sports Direct had filed a blizzard of alternative offers It is said that Debenhams has made it possible to circumvent its solvency.
Debenhams and KPMG, who will supervise the CVA, declined to comment.