- Angela Gonzalez-Rodriguez |
The fast fashion chain is reported to be considering a 10 percent reduction of its home market’s physical network.
Sources close to the matter quoted by Sky News explained that if the reported plan went ahead, it would mean about a 10 percent of New Look stores shut down (60 stores) with sizeable rent reductions sought at many of the remaining branches.
New Look owns 600 stores nationwide and, according to the same sources, would be looking into entering into a Company Voluntary Arrangement (CVA). This is a legally binding process with the firm's creditors to allow a proportion of debt to be paid back over a fixed period of time. This agreement would require the consent of bondholders, while landlords and other creditors would be asked to vote on the plan later this year.
On a related note, ‘The Sunday Times’ reported earlier this month that credit insurance had been withdrawn to many of New Look's suppliers, a move that would force the company to pay for products up-front.
New Look has been one of the worst affected high street fashion houses, with like-for-like sales at its UK stores falling by over 8 percent in the last quarter. The company has been owned since 2015 by Brait, an investment vehicle headed by businessman Christo Wiese.