Under the proposal, the fashion retailer has identified 60 out of its total 593 stores in the UK for potential closure, alongside a further six sites which are sub-let to third parties.
It also includes plans to reduce rental costs and seeks revised lease terms across 393 stores.
The proposal involves a requirement to make redundancies from the stores which have been identified for potential closure, expected to be a maximum of 980 members of staff amongst the company’s current UK staff base of 15,300 people.
New Look is seeking creditor approval on the proposal, which is due on 21 March 2018. All UK stores will remain open as normal during the period of the proposal and the company’s online sales channel will be completely unaffected by the proposed changes.
Daniel Butters and Neville Kahn of Deloitte LLP, the business advisory firm, have been appointed as Nominees to the CVA.
Alistair McGeorge, executive chairman of New Look, said: “Given our challenged trading performance and over-rented UK store estate, we are having to take tough but necessary actions to reduce our fixed cost base and restore long-term profitability.
“We have held constructive discussions with our key landlords and strategic partners and will now seek creditor approval on our CVA proposal. A priority for us is to keep all potentially affected colleagues informed during this difficult time.”
Daniel Butters, partner at Deloitte, added: “The retail trading environment in the UK remains extremely challenging, driven by weaker consumer confidence, the implications of Brexit and competition from online channels.
“New Look is an iconic brand on the high street and the CVA will provide a stable platform upon which management’s turnaround plan can be delivered. We have fully engaged with the British Property Federation and its members and their views are reflected in what we believe is a fair proposal to restructure the property obligations of the company.
“It is important to stress that no stores will close on day one, and employees, suppliers and business rates will continue to be paid on time and in full.”
The full list of stores in danger are:
- Aberdeen – Bon Accord
- Bolton (menswear store)
- Burton (menswear store)
- Cameron Toll
- Cardiff – Queen Arcade
- Doncaster (menswear store)
- Dundee – Wellgate
- Exeter (menswear store)
- Gateshead – Team Valley
- Glasgow – Buchanan Street (menswear store)
- Hanley (menswear store) – Intu Potteries
- Hounslow (menswear store)
- Hull – Whitefriargate
- Leeds – The Core Shopping Centre
- Leicester – Haymarket
- London – Marble Arch
- London – Moorgate/ London Wall
- London – Oxford Circus
- Maidstone (menswear store)
- Merry Hill (menswear store)
- Metro Centre – (menswear store)
- Newport (menswear store)
- Newton Mearns
- North Shields
- Nottingham (menswear store)
- Ocean Terminal
- Peterbrough Bridge Street
- Reading – Broad Street
- Reading Oracle (menswear store)
- Romford (menswear store)
- Shrewsbury (menswear store)
- Stockport – Merseyway
- Stratford Upon Avon -Bridge Street
- Torquay – Union Street
- Weston Favell
- Wigan (menswear store)