It has been reported that Office, the footwear chain owned by Truworths International, has hired advisors to draw up plans for a Company Voluntary Arrangement. (CVA)
A restructuring programme is being looked into, to give the retailer a chance of survival in the tough retail environment
According to Sky News, Alvarez & Marsal has been appointed and will be finalising a restructuring plan in the coming weeks. It is expected that around 100 of their stores will close. A CVA is not yet confirmed and so alternative strategies are being looked at, though it is likely that a CVA will be proposed.
Truworths International, who own the shoe retailer, are a South African holding company, listed on the Johannesburg stock exchange. They brought the chain in 2015, for a deal around £250m.
Office trade within the UK, Ireland and Germany
Insiders say that Deloitte were brought in by Office’s lenders to advise on their options.
The decision to explore a CVA, makes Office the most recent retailer to turn to the insolvency mechanism, to close stores and slash rents in a fight for survival in on the High Street.
Arcadia group's CVA was approved by its creditors last month and are still waiting for their 28-day challenge period to see if it will be subject to any legal appeals. Similarly, this week, Monsoon Accessorize are in the process of asking its creditors to vote on its CVA Proposal. In the last two years, Carpetright, Debenhams, House of Fraser, Mothercare and New Look have all used with varying degrees of success a Company Voluntary Arrangement.
Even with a CVA approved, some retailers have still collapsed into administration. Office were one of House of Frasers creditors, said to be owed £700,000 in concession payments, when the department store fell into insolvency proceedings last year.
Office could not be reached for comments, whilst A&M declined. However, it has been reported earlier this year that Office had continued concerns over Brexit and the depressed consumer demand. Though despite this, they insisted they were in a strong position to continue growth.