David Jones faces possible store closures as owners scramble for Christmas survival

Private-equity owner Anchorage Capital is holding intense negotiations with landlords, suppliers and lender Hilco Capital to decide David Jones’ long-term structure after the crucial Christmas period. Hilco has provided additional financing above the agreed facility to allow the chain to stock up for the season and will use the funds for rent on its 40 stores and supplier payments. The retailer has breached a minor covenant, giving Hilco the right to take control, and discussions may result in store closures.

Luxury and designer labels such as Dior, Gucci, Chanel and several Australian brands have recently moved to rival Myer, which is also courting younger shoppers. Erica Berchtold, appointed chief executive in late June, is leading a turnaround amid losses of $95.5 million for the year to June 29. Online shoppers are urged to spend remaining gift-card balances quickly as the future of the 188-year-old retailer hangs in the balance.