4 September 2020
Creditors have approved Jigsaw's CVA which will see it close 19 stores and switch others to turnover rents.
14 August 2020
Jigsaw launch its CVA proposal; involving 19 stores earmarked for closure and 16 stores remaining on full rent, with the other 41 of the retailers' portfolio switching to turnover-based rents.
Creditors are set to vote on the proposal on 3 September 2020.
Sources have said that earmarked locations for closure include Bluewater in Kent, Westfield in London, Manchester and Birmingham. Sources also say that of the 41 stores switching to turnover-based rents, 24 would pay the higher of 11 per cent of net sales turnover each year or 20 per cent of its contractual rent. The other 17 stores would pay eight per cent of net sales of 10 per cent of the contractual rent.
Also included in the CVA proposal is thought to be a £4m credit facility from Mountain Berg, its main shareholder, so long the CVA gets the approval needed from creditors.
This comes after the fashion retailers' sales for the year to January fell by 7 per cent to £81m whilst EBITDA loss after exceptionals deepened from £1.5m to £2.4m. In just under three years the company has had three chief executives and three chief financial officers, thought to be due to poor trading as it was slow to invest in ecommerce.
A spokesperson shared “Like all retailers, Jigsaw is assessing all aspects of its business to ensure that it is in the best position to navigate through this difficult period....We are working with [advisers] Cavendish and KPMG to undertake this strategic review of our business and for our conversations with our landlords.We will continue to work closely with our landlords as we assess our store portfolio.”
6 August 2020
Sources say Jigsaw is near to becoming the next high street chain to launch a company voluntary arrangement. If approved by its creditors, this would involve rent reductions, store closures and job losses. The details are to be revealed in a few weeks, once a CVA proposal has been prepared.
20 July 2020
David Ross, the co-founder of Carphone Warehouse, has drafted in KPMG to oversee rent negotiations with landlords and gauge interest from prospective buyers, for retailer, Jigsaw.
City sources say Cavendish Corporate Finance will be working on a possible sale or the recruitment of a new external investor.
The retail sector has faced challenges amid the COVID19 pandemic. Tens of thousands of jobs have been axed and names such as, Oasis, Warehouse, Cath Kidston and Laura Ashley have collapsed into administration.
Jigsaw was expected to close a number of its c.75 UK stores permanently, no matter the outcome of its talks with landlords.
Mr Ross took ownership of the company in 2018 and cut out any non-core areas i.e. menswear, in effort to streamline its operations. Jigsaw recently left the Australian market, after withdrawing from the US and from its childrenswear line last year. Such decisions left it focused on its core business of selling women’s fashion and accessories in the UK.
A spokesperson of the retailer said: ‘’We are confident that Cavendish and KPMG are the right partners to undertake this strategic review of our business. Jigsaw is a valued British heritage brand and the Board is determined to do all it can to steer the company and its staff through this incredibly challenging time."