Stationer Paperchase has proposed a restructuring that involves the closure of five of its 145 branches. Another 23 stores are at risk because they try to reduce their rents by 50 percent.
The retailer is involved in a voluntary agreement (CVA) with its creditors.The papers were met by fewer customers, increased rents and corporate profits as well as higher costs due to the devaluation of the pound.
The pre-tax profit dropped from just over £600,000 in 2017 to a loss of £6.3 million last year, according to accounts filed with Companies House.
However, sales increased by 6% thanks to growth in online and foreign business.
The company proposes to link part of its rents with the sale.
Last month, the parent company of Paperchase Primary Capital had called on KPMG consultants to increase capital.
Will Wright, restructuring partner at KPMG and proposed supervisor of the CVA, said the deal gives the company ” the ability to streamline their business portfolio by offering branches that are unprofitable, secure rental reductions where companies overleased and rental revenues to reflect the high season of the business.”
The creditors will be informed on 22 June 2014. June 2014. The commission will present its proposal on 15 November. The commission will be voting on the proposals on 15 March. Paperchase must secure at least 75% creditor approval for the CVA in order to move forward.