New Look will shutter up to 60 stores and axe almost 1,000 jobs under the terms of a company voluntary arrangement (CVA) it has launched today.
The embattled fashion chain said the proposal, which will also allow it to slash rents across its portfolio, will help it “improve the operational performance of the company”.
New Look said it had identified 60 of its 593 stores for “potential closure”, alongside another six sites which it currently sub-lets to third parties.
A maximum of 980 roles across those stores will be made redundant as part of the CVA.
However, New Look said it would attempt to redeploy affected staff where possible.
Creditors will now vote on the proposal on March 21 – days before its next rental bill is due.
It comes after Retail Week revealed last night that New Look had secured approval from bondholders to change their terms, paving the way for the CVA to be formally launched.
Deloitte have been appointed nominees to the CVA.
New Look executive chairman Alistair McGeorge said: “Given our challenged trading performance and over-rented UK store estate, we are having to take tough but necessary actions to reduce our fixed cost base and restore long-term profitability.
“We have held constructive discussions with our key landlords and strategic partners and will now seek creditor approval on our CVA proposal. A priority for us is to keep all potentially affected colleagues informed during this difficult time.”
Deloitte partner Daniel Butters: “The retail trading environment in the UK remains extremely challenging, driven by weaker consumer confidence, the implications of Brexit and competition from online channels.
“New Look is an iconic brand on the high street and the CVA will provide a stable platform upon which management’s turnaround plan can be delivered.
“We have fully engaged with the British Property Federation and its members and their views are reflected in what we believe is a fair proposal to restructure the property obligations of the company.”