Yahoo Finance Fresh attempt to stop another UK high street chain going bust
Fashion retailer Select has been thrown a lifeline after its administrators Quantuma filed a proposal to rescue the beleaguered company.
They say Select has struggled to achieve its turnaround plan, suffering from falling consumer confidence, Brexit uncertainty and sterling’s volatility, as well as the woes of other bricks-and-mortar high street shops.
Its administrators have warned there may be redundancies and store closures even if the rescue plans gets the green light, but said there were no “immediate” plans for cutbacks.
Quantuma hopes to rescue the firm through a company voluntary arrangement (CVA), which allows the fashion retailer to pay creditors over a fixed period. The company’s creditors will votes on its future on 11 June.
The administrator is not planning any immediate closures of Select’s stores or staff redundancies. Select has around 1,800 employees and operates from 169 stores across the UK, supported by its head office and warehouse facilities.
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“The business experienced a sharp downturn in fortunes at the end of 2018,” said Andrew Andronikou, partner at Quantuma. “Sales remained subdued in early 2019. This inevitable result was a squeeze on cash flow.
“The turnaround plan embarked upon by the management delivered benefits but had not reached sufficient maturity to protect the business from this impact in the market. There remains the opportunity, with the support of its parent company, to bring these to fruition and in doing so return the business to a stable and profitable position.
“As joint administrators, we have arrived at the view that a CVA offers the best outcome for creditors as a whole. The proposal does not outline the immediate closure of any of the company’s stores, and any immediate redundancies, however some may occur even if the proposal is approved.”
Select has an annual turnover of £77m and targets 18-35 year-olds with more than 4,000 fashion products.
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