// New Look plans to launch CVA as part of restructuring
// The retailer will ask landlords at more than 450 stores to accept new lease contracts
// It has over 10,000 staff in the UK
New Look is reportedly preparing to launch a second CVA as as part of a major restructuring.
The fashion retailer is expected to appoint advisers from Deloitte this week to oversee the insolvency process, Mail on Sunday reported.
New Look, which has more than 10,000 staff, will ask landlords at more than 450 stores to accept new lease contracts that would ensure it pays rent based on how much money each store generates.
- New Look threatens landlords with pre-pack administration
- New Look seeks turnover-based rent with landlord
It marks the first time a major retailer has sought blanket lease contracts linked to turnover.
Moreover, other fashion retailers such as Jigsaw and River Island have also recently revealed that they are considering CVAs as the high street continues to struggle post-lockdown.
The CVA plan is understood to have received the approval of New Look’s bondholders – who agreed to cut the retailer’s debt by £1 billion last year.
However, it will require substantial support from landlords to be successful.
The first time New Look launched a CVA was in March 2018, when it had to close 60 stores permanently and scrap 980 jobs.
Around 98 per cent of New Look’s landlords agreed to a switch from quarterly to monthly rent payments and rent reductions of between 15 per cent to 55 per cent across 393 of its shops as part of the CVA at the time.