- Vivian Hendriksz |
London - Mothercare is set to shut approximately 50 of its 137 UK stores by June next year, as its Company Voluntary Arrangement (CVA) proposals are approved. The move could see up to 800 jobs lost as landlords give the maternity specialist's financial rescue package the green light.
Mothercare's CVA receives greenlight from creditors
The news comes after Mothercare held meetings with creditors this afternoon to discuss CVA proposals. The retailer revealed that its CVA proposals were approved by the requistie majorities of more than 75 percent of the unsecured creditors of the companies present at each of the meetings.
"We are very grateful for the support of our many stakeholders across our creditor base in supporting today's CVA Proposals," said Clive Whiley, interim executive chairman in a statement. "Their forbearance and support today is a crucial step forward to achieve the renewed and stable financial structure for the business that will drive an acceleration of Mothercare's transformation."
Creditors have until June 29 to challenge the CVA proposals in court. Mothercare stressed that its CVA approval does not mean its business has fallen into administration. "These measures provide a solid platform from which to reposition the Group and begin to focus on growth, both in the UK and internationally," added Whiley. Mothercare first announced plans for its CVA on May 17, highlighting its plans to refinance its buiness and resturcture its UK store portfolio.
The maternity and babywear specialist has already reduced its UK store portfolio from 220 stores down to 137 the last four years.
Photo: Indi Samarajiva via Flickr