Update: Poundstretchers has had its CVA proposal approved.
More than 90 per cent of creditors voted to approved the CVA plans, including the majority of landlord, surpassing the 75 per cent total required in order to pass the resolution.
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 focussed store portfolio."
Poundstretcher launch a company voluntary arrangement (CVA) proposal which features significant rent cuts across its 450 UK stores.
KPMGs' Will Wright and David Costley-Wood are the proposed nominees.
The unveiled proposal sees 94 stores continuing to pay the same rent and 84 stores experiencing a reduction of rent between 30 and 40 per cent over three years. The remaining 253 stores would pay six weeks rent in full before adopting them based on each stores own ''commercial merits''
Poundstretcher said the CVA is part of a wider turnaround plan it is involved in, seeking to restructure its UK store portfolio, realign head office costs and stem losses from underperfoming outlets. The retailer looks to pave the way for investment into its core estate and product offering.
Poundstretcher experienced a loss-making period at least a year before the coronavirus pandemic hit, making the issues worse.
It is in the directors' intention to put the retailer into administration before the decision is made on the CVA. The CVA proposal is to take place on 2 July in which 75 per cent creditor approval will be needed for the CVA to go ahead.
Over 5,500 people are at risk of losing their jobs; across its stores, head office and warehouses.