Dune is the latest high street name to launch a Company Voluntary Arrangement (CVA) proposal. Despite strong online sales, the company has been “affected significantly” by the lockdown rules closing non-essential shops.
The fashion footwear and accessories retailer, founded in 1992, currently operates 43 stores and 175 concessions and employs around 1,200 people.
With future trading set for more uncertainty while the pandemic continues, Dune is undertaking a major financial and operational restructuring programme, supported by investors. While no stores are earmarked for immediate closure, they are seeking to reduce costs. If the CVA is approved, a number of Dune sites will move to a turnover-based rent.
Daniel Rubin, founder and CEO of The Dune Group, said: “Before COVID-19 hit, the business was trading robustly, but the resulting lockdowns have had, and continue to have, a severe financial impact.
“We are profoundly grateful for the support shown by our key stakeholders since the start of the pandemic, but with so much uncertainty still surrounding the outlook for non-essential retail, we’re now in a position where we need to seek additional support if we are to protect our business.
“The CVA provides us with much needed flexibility so that we can emerge on the other side of this crisis in the best shape possible.”
He added: “After 28 years of successfully growing the business, this is not an action that we wished to take. However, although we have seen exceptional growth in our online business, it hasn’t been sufficient to offset the loss of sales from our stores being closed.
“We remain firmly committed to the high street, and indeed, in the longer term, our strategy is to grow our high street presence and adapt our business model with our concessions partners.”
KPMG has been nominated to oversee the CVA. Its head of regional restructuring, Will Wright, said: “While there is increasing hope that restrictions will be eased later in the Spring, the reality is that a number of high street operators have little option but to take urgent steps to address their fixed cost base now if they are to make it through the next few months. The proposals launched by Dune today are no exception, and if approved, would give the Company that vital lifeline to see them through the uncertain weeks and months ahead.”