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Retail woes grow as New Look eyes store closures

Sky News has learnt that the South African-owned sequence is sketch up proposals for a Company Voluntary Arrangement (CVA), a routine mostly used by struggling retailers to restructure financial obligations to creditors.

Sources pronounced on Thursday night that New Look’s CVA devise was not nonetheless finalised and was only one of a series of options under consideration.

A decision about either to ensue is approaching to be t‎aken in the coming weeks, and would need the agree of bondholders.

If it does go forward with the store closures, roughly one-tenth of New Look’s nearly-600 outlets in Britain would be axed, with sizeable lease reductions sought at many of the remaining shops.

Landlords and other creditors would be asked to opinion on the devise after this year.

New Look ‎is the latest in a series of big names to inspect a radical timorous of their store portfolios amid rising pressures from online and bonus rivals, increasing work costs and a deteriorating opinion for consumer confidence.

Toys R Us UK won capitulation for a devise to close about a entertain of its stores shortly before Christmas, while Sky News suggested last week that House of Fraser, the dialect store chain, was asking landlords to revoke its lease bill.

A flurry of trade updates during the last 10 days has suggested typically mixed‎ fortunes for Britain’s high street giants, with Marks Spencer disclosing on Thursday that like-for-like sales had depressed over Christmas in both its food and wardrobe businesses.

Debenhams and Mothercare have been among the other big losers, while Next achieved better than expected.

New Look’s opening has stuttered during the last year, wit‎h former boss Alistair McGeorge returning as its executive authority in November.

He described the sell sourroundings as “challenging”, but pronounced improving its fortunes would not be an overnight job.

Like-for-like sales at its UK stores fell by over 8% in the many recently reported period.

Last weekend, The Sunday Times reported that credit insurance had been cold to many of New Look’s suppliers, a pierce that would force the company to compensate for products up-front.

The company has been owned given 2015 by Brait, an investment car headed by businessman Christo Wiese, who also has interests in Virgin Active and the Iceland supermarket chain.

Mr Wiese is also connected to Steinhoff, the South African holding company which has been rocked by a outrageous predicament over its prior accounts.

Steinhoff owns British retailers such as Poundland and is approaching to find to offload them as it tries to lift cash.

New Look declined to criticism on the intensity store closures on Thursday night.

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