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High Street

Mothercare latest to consider CVA store closures

Mothercare is reportedly considering the possibility of closing a third of its stores and reducing its rents through a Company Voluntary Arrangement (CVA).

According to reports Mothercare would look to close around 47 of its 143 stores if a CVA is agreed with lenders.

Mothercare would join a host of high street retailers who are looking to reduce costs by entering a CVA with New Look and Select having already agreed with lenders and Carpetright also considering the process.

The news comes after the baby retailer brought in former Tesco and Kmart executive David Wood to be its new chief executive and take charge of turnaround plans following the resignation of Mark Newton-Jones last week.

It was reported that Mothercare’s board were not happy with the progress that Newton-Jones was making with his turnaround strategy.

A Mothercare spokesman told The Daily Telegraph that talks with the firm’s lenders were “progressing constructively”.

The spokesman said Mothercare was “exploring additional sources of financing to support and maintain its transformation programme” and talks to secure extra money were ongoing.

Last week it was also reported that supermarket giant Sainsbury’s has considered acquiring the embattled retailer but eventually decided against making an offer.

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