Paperchase has won the approval of its creditors to proceed with a CVA which will see achieve rent reductions for 100 of its stores. For 28 locations the retailer will pay 50 per cent of the contractual rent for a period of three months whilst it considers whether it is viable for them to continue to trade. For another 70 stores, landlords have agreed that rent will be tied to the turnover of each store going forward, and a further 45 stores will continue on unchanged terms.
This comes following advice from KPMG who were called in as advisors by Paperchase parent company Primary Capital.
“The alignment of store rents to footfall and trading, alongside our long term strategy to diversify and increase revenue from UK and international partnerships, and online sales, will lay the foundations for a successful future,” said, chief executive of Paperchase Products Ltd., Duncan Gibson.
To which Will Wright of KMPG added: “The engagement and buy-in of all stakeholders throughout this process has been vitally important in putting together an innovative CVA proposal which, following today’s approval will allow Paperchase to move forward with a financial and operational restructuring plan.”
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