Carpetright creditors approve plans to close 92 stores, including two in Norfolk
PUBLISHED: 16:29 26 April 2018 | UPDATED: 16:29 26 April 2018
Creditors of Carpetright have approved a rescue deal which will see a quarter of its stores shut - including two in Norfolk.
As many as 300 jobs will be lost when 81 of the retailer’s stores close, including in King’s Lynn and Great Yarmouth, joining a further 11 which have already stopped trading.
The firm’s 36 other stores across East Anglia, including in Norwich, Ipswich, Lowestoft, Thetford and Sudbury, have been spared closure.
At a meeting on Thursday more than 75% of Carpetright’s unsecured creditors in value approved the restructuring deal.
In response to the vote, the company’s chief executive Wilf Walsh said: “Addressing our legacy property issues to reduce our fixed costs to sustainable levels is critical to securing Carpetright’s recovery.
“Receipt of creditor approval for the CVA proposal will enable us to take tough but necessary action to establish a right-sized estate of stores on economic rents, which is essential to restoring our profitability.
“Our focus now shifts to the forthcoming shareholder vote and to our preparations for the proposed equity financing which will recapitalise the business and enable Carpetright to address the competitive threat from a position of strength.”
Details of the restructuring plan – a kind of insolvency procedure which will allow Carpetright to keep trading – were announced earlier this month. At this time the company said it would relocate staff where possible.
It came soon after the retailer was rocked by a “technical breach” of its banking arrangements, which it has taken action to address and amend.
In a statement released on Thursday, the company said it is continuing to trade “as a going concern” under the control of the directors and reiterated that it “is not in and will not be in administration” as a result of the CVA’s approval by creditors.
It added that the implementation of the CVA would be conditional upon a “successful equity capital raising”, which it expects to launch as planned on or around May 18.
Company shareholders are due to discuss the CVA in a meeting on Monday, April 30, but the company said the decision of the creditors “would prevail” should the shareholders reject the proposals.