The Press and Journal (Inverness, Highlands, and Islands)
Major changes for New Look
New Look is set to fall into the clutches of its lenders as part of a painful restructuring to put the struggling fashion retailer on a securer financial footing.
The debt-for-equity swap will see the firm’s long-term borrowings cut from £1.35 billion to £35m, alongside a new capital raise of £150m funded by issuing new money bonds.
As a result, New Look’s annual interest payments will fall from £80m to £40m and its borrowings have been extended to 2024, giving it breathing space.
It means bondholders – thought to include Carlyle, GSO, CQS, M&G Investments, Avenue Capital and Alcentra – will hold 72% of its equity.
Brait, New Look’s South African owner controlled by billionaire Christo Wiese, will see its holding significantly cut.
Chairman Alistair
“Agreement representsa criticalstepin ourturnaround”
McGeorge said: “Today’s agreement represents a critical step in our turnaround plans and lays the foundations to secure the future and long-term profitability of New Look by materially deleveraging our balance sheet and providing us with the financial flexibility to better attack our future.
“Upon completion of the restructuring, our focus will be to enhance profitability by continuing to provide fantastic product for customers, building brand equity and grasping new market opportunities.”
New Look pointed to “increased headwinds” in late November that saw UK like-for-like sales decline 5.7% in December, resulting in comparable sales growth of just 0.9% in the third quarter as a whole.
The decline in total UK sales was also hit by a store closure programme. A new scheme aimed at north-east tourism businesses is expected to help unleash their potential as major revenue earners.
The Tourism Business Game Changer programme aims to support executives, managers and owners who want to cash in on major infrastructure investment in the region, as well as changing consumer trends.
Devised by private sector economic development body Opportunity North East (One) and Scottish Enterprise (SE), and backed by tourism body