Hotter Shoes submits CVA proposal, plans to close 46 stores

British footwear retailer Hotter Shoes has reportedly submitted its company voluntary arrangement (CVA) proposal as it looks to shrink its store estate.

The company’s owner Electra Private Equity wants to close 46 stores, bringing its number of stores from 61 to 15, according to Drapers. The company said it is a necessary move to “avoid the likelihood of Hotter going into administration”. The proposal will reportedly result in a number of redundancies but will save 350 jobs.

It would also see a change to terms of rental payments across the unaffected stores.

Creditors will vote on the proposal at a shareholders meeting on 29 July. If approved, the CVA is expected to be completed on 1 March 2021.

Hotter eyes store closures

In June, the CVA plans were announced. Electra Private Equity revealed at the time that Hotter Shoes had been in talks with a number of its landlords to reduce the size of its store estate “to a level and cost that allows Hotter to remain viable.”

Electra Private Equity PLC chairman Neil Johnson said in a statement: “Before the pandemic hit, Hotter, under new chief executive Ian Watson, was making good progress to accelerate the implementation of a digitisation strategy to return it to its direct marketing routes.

“The need for these actions has been intensified by the consequences of the past three months of lockdown. If successful, the proposed CVA will result in fewer stores, which will secure the future of a smaller, sustainable business and will save over 350 jobs. I would like to thank all our colleagues at Hotter for their continued understanding at this difficult time.”

Photo credit: Hotter Shoes, Facebook