Sky News are reporting that the 242-year old department store chain, which employs around 22,000 people, may file a notice of intention to appoint Administrators as early as next week, with KPMG amongst those to potentially handle the process.
Debenhams has 'furloughed' the vast majority of its workforce following the closure of its 142 stores across the UK, and those employees' wages will be covered for three months by the government's Coronavirus Job Retention Scheme.
The Debenhams website will reportedly continue to operate, even during any period of insolvency.
They have millions of pounds of stock on order from suppliers that is no longer required due to the lockdown of all non-essential shops.
There is a realistic prospect of suppliers taking legal action against the company for deferring payment of invoices.
Shareholders such as the American hedge funds are confident that the chain has a viable future, however.
The intention of appointing Administrators would be to protect the business, rather than closing it down.
In a statement, Debenhams have said: "Like all retailers, Debenhams is making contingency plans reflecting the extraordinary current circumstances.
"Our owners and lenders remain highly supportive and whatever actions we may take will be with a view to protecting the business during the current situation.
"While our stores remain closed in line with government guidance, and the majority of our store-facing colleagues have been furloughed, our website continues to trade and we are accepting customer orders, gift cards and returns."
