Select CVA rubberstamped

By Paul Norman - Friday, April 13, 2018 13:27

The Company Voluntary Arrangement (CVA) for high street fashion chain Select, which has 183 stores in the UK, has been approved by 94% of its creditors at a meeting in central London this morning.

Select said it does not intend to close any stores and the vote means the saving of 2,000 jobs.

The proposals were formulated by the directors of Select, with the assistance of partners Andrew Andronikou, Andrew Hosking and Carl Jackson of corporate restructuring and business advisory firm Quantuma.

Select operates from 183 stores across the UK supported by centralised head office and warehouse facilities, plus online trading. The company trades as a value ladies’ fashion retailer, targeting 18-35-year-olds with up to 4,000 fashion products.

Andrew Andronikou said: “The proposal primarily seeks to obtain the approval from a number of the company’s landlords to accept a reduction in rent for some stores with an option to take back loss-making sites, which appears to reflect the current prevailing issues for businesses trading on the high streets.

“The company is committed to protecting employment and following the acceptance of the proposal, will seek to continue to operate all of its UK sites.

“In doing so, this should provide stability to landlords and staff with further costs savings to be achieved via economies of scale and a controlled review of operational costs and structures to be conducted outside of the CVA proposal.

“We are naturally pleased with the outcome of today’s meeting and the subsequent result.

“We look forward to working with the creditors in the near future in order to pay their dividend and are delighted that the acceptance of the proposal should see some 2,000 jobs preserved in the UK retail sector.”

Under the proposals Select has split its 183 stores into four categories based on performance.

Owners of 25 of its stores will receive 25% rent, but there will be a “rent-free period”.

Select will pay 81 landlords 70% of rent owed, and will pay 50% to 27 landlords. The chain’s top 50 stores would remain unaffected by the process, although these will switch to monthly payments, rather than quarterly rents.

pnorman@costar.co.uk

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