One of the UK’s biggest stationery retailers, Office Outlet, formerly known as Staples, is the latest to confirm a CVA.
Plans to close four of their 96 stores during the latter part of 2018 have been confirmed, as well as a request for a three-year rent-free period from landlords across 20 stores. 44 Job losses would be a result. The remaining stores, as well as the online business, will continue trading.
This is all a part of their restructuring plan made with appointees, Deloitte. Deloitte was appointed by owner, Hilco. Hilco acquired and rebranded the previously chain in 2016.
Daniel Butters of Deloitte commented how the CVA would enable the managements turnaround plans to be delivered. He stresses how no stores will close immediately and all employees and suppliers will be paid on time and in full.
Office Outlet have been struggling due to increasing costs and weak sales, which are forced upon the industry. The retailer is among a list of household names, who have turned to a CVA this year. Carpetright, Homebase, New look and Mothercare to name but a few, all being hit the retail crisis.
Chris Yates, CEO of Office Outlet stated that the chain has had to take tough actions in order to reduce their fixed cost base and to allow them to restore long term profitability. He believes this is necessary with the challenging UK environment and their over-spaced, over-rented UK store estate.
Office Outlet are now awaiting the creditors approval on their CVA proposal. Constructive discussions with key landlords and strategic partners have been held. The CVA meeting is set to be held on the 6th September 2018.