520 jobs at risk as Sir Philip Green plans 23 store closures

Sir Philip Green’s Arcadia group has confirmed plans to shut 23 stores in the UK and Ireland putting 520 jobs at risk.

The group – whose brands include Topshop, Burton and Dorothy Perkins – is also seeking to slash rents at 194 further sites in the UK and Ireland as it launches a rescue plan in the face of a “highly competitive retail environment”.

Proposals announced by the company will in addition see Arcadia halve its annual payments to the company’s pension scheme, with Sir Philip making up the shortfall by injecting a total of £100m over the next three years.

Arcadia will seek approval for a series of company voluntary arrangements (CVAs) – details of which were first reported by Sky News – from creditors at a meeting next month.

The proposals also involve all affected landlords being given an entitlement to 20% pro-rate share of the equity value of the business in the event of it being sold in the future.

In addition, Sir Philip will inject a further £50m into the group, on top of £50m of funding provided in March.

Arcadia said the CVAs were part of a wider turnaround plan which will also involve more cost efficiencies, store investment and development of the group’s online offer.

It said it was also looking to shut all 11 of its Topshop Topman stores in the US as part of this plan.

The company, which employs 18,000 people, currently operates 566 UK and Ireland stores under the Burton, Dorothy Perkins, Evans, Miss Selfridge, Topshop, Topman and Wallis high street brands as well as out-of-town brand Outfit.

Arcadia chief executive Ian Grabiner said: “Against a backdrop of challenging retail headwinds, changing consumer habits and ever-increasing online competition, we have seriously considered all possible strategic options to return the group to a stable financial platform.

“Following constructive discussions with all key stakeholders, we believe that a CVA is a best course of action.

“This has been a tough but necessary decision for the business.”

More follows…

Source: Read Full Article