Tue, 22 May 2018 | ADMINISTRATION
Mothercare has reinstated its former chief executive Mark Newton-Jones and announced plans to close 50 stores amid the delivery on an insolvency rescue package.
According to the retailer, it plans to push forward its store closure plans in a bid to gain £113.5 million of funds through the removal of 50 sites. Additionally, this refinancing will be supported by the pursuit of a Company Voluntary Arrangement (CVA), a form of insolvency that will allow the company to secure rent reductions to reduce outgoings.
This move, which is becoming popular with high street companies, will also buy the company more time to trade and avoid going into administration while potentially searching for a buyer, according to Simon Underwood, business recovery partner at Menzies LLP.
"Allowing a business to continue trading and its existing management to retain control, CVAs are sometimes viewed as a more attractive option than other methods of insolvency, such as pre-pack administrations," said Mr Underwood.
"However, if all struggling retailers start taking this route, it could make matters worse for the ailing High Street – with more shoppers moving online and creating more empty stores.
The decision to pursue insolvency has also been taken by other large high street brands, including Toys R Us, Carpetright and Prezzo, all of which have closed a number of their stores in a bid to save money while they seek reductions in rents and other overheads.
Commenting on Mothercare's decisions moving forward, the firm's chairman Clove Whiley, added: "These measures provide a solid platform from which to reposition the group and begin to focus on growth, both in the UK and internationally."
The company possesses up to 50 vans in stock on-site, with an indoor and outdoor showroom allowing it to fully showcase its stockholding. The business offers full dealer facilities, including arranged finance, optional breakdown cover and part-exchan...
LEASEHOLD
The business is a well-established firm of catering butchers, operating in the North West of England. This business was established 30 years ago and has been owned by the current owner for twelve years in which time it has thrived, retained and built...
FREEHOLD
The business is a friends and family-run, bathroom retailer, that supplies a range of home improvement products, with a particular focus on bathrooms and plumbing equipment, to both a trade and domestic customer base. The business also offers an inst...
LEASEHOLD
07
|
May
|
In vitro diagnostics regulatory consultancy acquired by listed firm | BUSINESS SALE
Abingdon Health, a listed diagnostic test manufacturer based...
07
|
May
|
UK administrations update: April 30 – May 7 | ADMINISTRATION
Since our last update, the following businesses have been co...
07
|
May
|
Plant and vehicle hire group acquired out of administration | BUSINESS SALE
A Leicestershire-based supplier of specialist plant and vehi...
Business Sale Report is your complete solution to finding great acquisition opportunities.
Join today to receive:
All this and much more, including the latest M&A news and exclusive resources
We can help you capitalise on insolvent businesses. We list UK businesses in administration, liquidation and with winding up petitions daily. Ensuring our members never miss out on an opportunity
Please choose your settings for this site below. For more information please read our Cookie Policy
These cookies are necessary for our website to function properly and provide you with access to all features.
These are analytics cookies that help us to improve the way our website works.
These are used to improve the functional performance of the website and make it easier for you to use.