Landlords give green light to Poundstretcher restructuring plan
Discount retailer Poundstretcher has had a major restructuring plan involving rent cuts approved by landlords.
More than 90% of creditors approved the move, which has bought an extra six weeks for 253 stores whose futures were at risk.
This therefore surpassed the 75% threshold needed to pass the cost-saving plans.
Its proposals for the Company Voluntary Arrangement (CVA) deal said that rents will now be paid on these sites for an initial six-week period.
However, it said the future of these “will depend on the commercial merits of each store” in collaboration with landlords, casting a shadow over their long-term future.
It is understood that more than 2,000 people work across the 253 stores, with 5,500 people employed by the group as a whole.
The deal has also secured rent cuts of between 30% and 40% for 84 of its 450 stores, while around 94 stores will continue to pay current rents.
Will Wright, restructuring partner at KPMG and joint supervisor of the CVA, said: “The approval of the CVA provides a stable platform from which the company can continue to operate across a more focused store portfolio.”
Poundstretcher opted to launch the CVA after the impact of Covid-19 on store footfall “exacerbated” problems after a decline in profitability in recent years.
Last month, hotel chain Travelodge secured the future of its around 10,000 staff after landlords backed its CVA plan.