New Look announces major finance restructuring
Fashion retailer New Look has announced a major restructuring of its finances as it battles against the effects of the coronavirus pandemic
The plans will involve the company launching a CVA to help reduce its rents. It will also cut its debts from £550 million to £100 million through a debt for equity swap and inject £40 million of new cash into the business.
Nigel Oddy, New Look chief executive, said: “As has been the case for many retailers, New Look’s financial position has been significantly impacted by Covid-19, and over the past five months we have had to take a number of tough but necessary decisions and actions to manage the impact this has had on our business and our people.
“We are pleased to have already gained backing from our banks and bondholders for our recapitalisation, and we are grateful for their support and the concessions they have made over recent times. However, this recapitalisation – which will enable us to deliver our long-term strategic plans and safeguard 12,000 jobs – can only be delivered if we secure the support of our landlords for our forthcoming CVA.”
New Look has now reopened 459 stores after the Covid-19 lockdown but said current trading is still being impacted by a decline in footfall, although online sales have been strong.
Oddy added: “New Look is a brand that has inspired tremendous loyalty over the past 50 years and has earned its place as one of the UK’s leading womenswear retailers. We are confident in our plans to build on these strong foundations with our revitalised broad appeal product ranges, and this transaction will allow us to secure our future for the benefit of all.”
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