Fashion Retailers Turn to CVAs for Survival

  • New Look planning a second CVA deal
  • Deloitte to negotiate with over 450 landlords
  • Turnover-based rent system proposed
  • Company’s bondholders reportedly supportive
  • Previous CVA led to closure of 60 stores and job losses in 2018
  • Jigsaw also considering a CVA proposal

Embattled fashion retailer New Look is reportedly planning a second Company Voluntary Arrangement (CVA) to address its rent issues. The company aims to switch to a turnover-based rent system with the help of accountancy firm Deloitte, which will negotiate with over 450 landlords across its 480 store estate. New Look has already withheld rent for both the March and June quarters. If the proposal goes ahead, it would mark the company’s second CVA in two years. Its previous CVA in 2018 received 98% approval and led to the closure of 60 stores and job losses. Meanwhile, fellow womenswear retailer Jigsaw is also considering a CVA proposal.

Factuality Level: 8
Factuality Justification: The article provides relevant information about New Look’s plans for a second CVA and mentions the involvement of Deloitte in negotiations with landlords. It also includes details about the previous CVA and its impact on the company. The mention of Jigsaw’s potential CVA adds context to the retail industry situation, but it is not directly related to New Look.
Noise Level: 4
Noise Justification: The article provides relevant information about New Look’s plans to launch a second CVA and mentions Jigsaw’s potential CVA proposal. However, it lacks in-depth analysis or exploration of the consequences for stakeholders and does not offer actionable insights.
Financial Relevance: Yes
Financial Markets Impacted: New Look and Jigsaw retailers’ financial performance and their negotiations with landlords
Financial Rating Justification: The article discusses New Look and Jigsaw retailers’ plans to negotiate rent payments with their landlords, which can impact their financial performance and the overall performance of these companies. This directly relates to financial topics such as operational performance and potential store closures.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the text.

Reported publicly: www.retailsector.co.uk