250 shops risk axe amid crisis
POUNDSTRETCHER IN PLEA TO CUT RENT
BUDGET chain Poundstretcher has sparked fears more than half its 450 stores could close.
The retailer, which has 5500 workers, wants to slash outgoings through a Company Voluntary Arrangement (CVA).
The plan, which needs creditors’ approval, would see rents cut by up to 40 per cent on 84 stores for three years. Another 94 stores would be unaffected. But Poundstretcher warned the future of a further 253 shops “will depend on the commercial merits of each store with the relevant landlords’ collaboration”. Closing all those could hit 2000 staff. A separate 23 stores could shut under plans by Poundstretcher to put the arm that owns them into administration.
Will Wright, of accountancy firm KPMG, which is organising the CVA, said: “Poundstretcher has suffered from significant impacts to profitability on several fronts over a sustained period, which were then further exacerbated by the impact of Covid-19 on footfall.”
The move comes amid a wave of proposed job losses by big firms in recent weeks, including 2500 by builders merchant Travis Perkins on Monday. Official data out yesterday reported that 600,000 workers had lost their jobs since March.
Elsewhere, retailer Oak Furnitureland has been rescued in a pre-pack administration.
The chain, which employs nearly 1500 staff, has been bought by hedge fund Davidson Kempner Capital Management for an undisclosed fee.
The new owner will review the firm’s 105 branches but refused to rule out job cuts and closures while negotiations with landlords and suppliers take place.
Customers with outstanding orders will not lose out and any deposits already paid will be honoured, the company said.