Carpetright to CLOSE 92 stores with 300 jobs AXED - Is YOUR local shop closing?
CARPETRIGHT has announced 300 jobs will be axed and 92 stores closed under a sweeping restructuring plan following tough trading. The embattled chain said overall, 92 sites had been earmarked for closure, although 11 have already stopped trading.
Carpetright is to close a number of stores
Carpetright added that the rent will be slashed on another 113 under-performing stores as part of the rescue deal under company voluntary arrangement (CVA) proposals being put to landlords.
The group - which employs nearly 2,700 staff in total - also confirmed an investor cash-call to raise around £60 million through a rights issue to put the company on a firmer financial footing.
Carpetright has in recent months issued a series of profit warnings because of weak UK retail spending and blamed some of its outlets for being “poorly-located”.
The company will now seek creditor approval at a meeting on April for the CVA which will allow the shop closures and lower rents, before asking shareholders for their backing on 30 April.
These tough but necessary actions will enable us to address the burden of a legacy UK property estate consisting of too many poorly located stores on unsustainable rents
Carpetright chief executive, Wilf Walsh, said it was "tough but necessary actions".
The details came as it revealed a "technical breach" of its banking arrangements, but the group said it was taking action to address this and ensure it is amended for the future.
The High Street is taking a battering over recent months, with New Look, Toys 'R' Us, Maplin and Marks and Spencer all announcing major closures in towns across the country this year.
Mr Walsh said: "These tough but necessary actions will enable us to address the burden of a legacy UK property estate consisting of too many poorly located stores on unsustainable rents and are essential if we are to restore our profitability and deliver a successful turnaround."Carpetright has engaged fully with the British Property Federation on the detail of the CVA Proposal and we thank them for their constructive approach.
"Completion of the CVA and equity financing will enable us to establish an appropriately-sized estate of modernised stores, on economic rents, complemented with a compelling online ffer, enabling Carpetright to address the competitive threat from a position of strength.
"We will remain in close contact with all colleagues to keep them fully informed as we move through this process."
Shares in Carpetright tumbled more than 23 per cent at one stage after details of the proposals and rights issue.
The firm, which has 409 UK shops, said trading had remained "difficult" since its last update on March 1, with the group continuing to expect a small underlying loss for the year to April 28.
Landlords will vote on the plans on April 26, while shareholders will have their say on April 30.
The rescue deal, which is being handled by Big Four accountancy firm Deloitte, marks another dark day for the sector, which has already seen thousands of jobs axed following the collapse of well-known names Toys R Us and Maplin.
Carpetright stores identified for closure on or after September 23
Ayr
Ballymena
Bangor (NI)
Barnsley
Beckton
Belfast - Newtownabbey
Bicester
Birmingham Stechford
Blackwood
Bodmin
Borehamwood
Burgess Hill
Burnley
Bury
Caerphilly
Catford
Coleraine
Derry/Londonderry
Dudley
East Grinstead
Edinburgh- Leith
Exeter
Exmouth
Falkirk
Folkestone
Fraserburgh
Glasgow - Great Western Road
Glasgow - Parkhead Forge
Gloucester
Great Yarmouth
Greenock
Guildford
Hamilton - Carpetright
Hamilton - Sleeprsight
Harrogate
Hayes
Hitchin
Monition
Huddersfield
Iverness - Merkinch
Kidderminster
Kings Lynn
Launceston
Leeds - Birstall
Leeds - Hunslet
Lewes
Lichfield
Lincoln
Livingston
Llanelli
Luton
Maidenhead
Neath
Oldham
Putney
Reading - Oxford Road
Redhill
Renfrew
Scarborough
Scunthorpe
Sheffield - Meadowhall
South Shields
St Austell
St Helens
Stafford
Stanmore
Stratford-upon-Avon
Streatham Common
Strood
Sunderland - Castletown
Telford
Thanet
Thornton Health - Carpetright & Sleepright
Tiverton
Wakefield - Cathedral
Wakefield - Westgate (Storeys)
Walsall
Warminster
Wigan - Robin Park
Wishaw
York - Foss Island