Ann Summers has received the green light from its creditors to go ahead with a company voluntary arrangement (CVA) to restructure its store estate.
The CVA, which was approved by 90 percent of creditors, will affect the 25 of Ann Summers’ 91 stores it was unable to agree revised rent terms for with landlords. They will now move to turnover-based rent.
The landlords of the 66 stores where the company had previously agreed revised terms will not be affected, nor will other suppliers of goods and services. No jobs will be lost or stores closed as a result of the CVA, the company said.
Following the CVA’s approval, additional funding of up to 10 million pounds is also being made available to Ann Summers to continue with its turnaround strategy.
Ann Summers CEO Jacqueline Gold said in a statement: “This has been a year like no other for Ann Summers. The pandemic has presented new challenges for our business in 2020, which are likely to continue into the early part of 2021. I’d like to place on record my thanks to all those suppliers who have supported the CVA, and to those landlords who agreed revised terms ahead of the CVA.
Ann Summers to move store to turnover-based rent
“Despite the ongoing impacts of Covid-19, with the CVA approved and additional funding in place, we are now able to look to the future with cautious optimism.
“There is a still a very important place on the British high street for Ann Summers, and with our store costs now largely rebased to reflect today’s much changed retail environment, we can not only continue to grow our strong and successful Online and Party Plan channels, but our iconic stores will also be able to thrive once conditions return to normal.
“The additional investment in the business will help us continue our development and growth strategy and accelerate the turnaround which is already well underway.”
It comes on the same day as UK womenswear brand LK Bennett received creditor approval for its CVA. A long list of other British fashion companies have launched CVAs in recent months in an effort to mitigate the financial impact of Covid-19, including Moss Bros, Clarks, New Look, AllSaints, Bair Group and Monsoon Accessorize.
Photo credit: Ann Summers, Facebook