LONDON, Aug 26 (Reuters) – Struggling British style retailer New Look released the most recent stage of its restructuring procedure on Wednesday, looking for turnover-based leases from landlords at 402 UK stores to help to decrease its costs and ensure its survival.
New Look said that the business voluntary agreement (CVA) it was proposing – the second restructuring of its store estate in three years – would require approval from property managers and unsecured creditors at a vote on Sept.15
The impact of COVID-19 lockdowns on retail sales was such that New Look, which employs 11,200 individuals, said it required to change to the turnover lease design to secure its future practicality.
New Look has currently won contract from its banks and bondholders over a recapitalisation strategy, however that deal is conditional upon the rebasing of its rents through the CVA, which is being introduced after discussions with property owners.
” The proposition … would alleviate the financial pressure on New Look as we navigate the post-COVID landscape, whilst likewise supplying our landlords with higher flexibility over their rental plans and ensuring closer positioning of interests with regard to sales recovery,” said New Look President Nigel Oddy.
Makeover is owned by its shareholders, with the greatest of those being South African financial investment company Brait, in addition to Alcentra, Avenue Capital and CQS. (Reporting by Sarah Young Editing by David Goodman )