// Paperchase’s rescue deal details confirmed: 1000 jobs saved but 27 stores to shut down
// Prior to its administration, reports suggested Paperchase had 127 stores
// As much as 250 redundancies will be made from the rescue deal and store closures
Details of Paperchase’s rescue have been revealed after it secured a pre-pack deal to save 1000 jobs and shut down 27 stores after it tumbled into administration.
It comes after Paperchase hired administrators from PwC earlier this month, after it saw sales slide on the back of significantly lower footfall amid coronavirus restrictions.
After speculation earlier this week, the stationery and greeting cards retailer confirmed that 250 redundancies will be made – out of a workforce of 1250 – as a result of the rescue deal.
This means 1000 jobs will be saved, and Retail Gazette understands that 27 stores will be shut permanently.
It is still not yet clear how many Paperchase shops will remain, but with previous reports suggesting it had 127 stores before it went into administration, it’s thought that the retailer’s store portfolio will be slimmed down to 100 after the closures.
However, Retail Gazette understands discussions on Paperchase’s store estate are still ongoing, and the portfolio could potentially end up being slimmed down to 90 stores.
The administrators confirmed that newly-formed company Aspen Phoenix Newco, which is backed by Permira Debt Managers, would take control of Paperchase.
The group said the rescue deal would retain its position in the UK retail landscape, “albeit in a smaller and more streamlined manner”.
Its new owners said that a “comprehensive transformation programme” was currently under way to help it rebound once restrictions lift.
“The cumulative impact of lockdowns and related restrictions means that it is imperative we make this tough but necessary decision to safeguard Paperchase’s future,” Paperchase chief executive Olly Raeburn said.
“In taking this action, we are giving ourselves the best opportunity to ensure that the business is fit for purpose in this new retail environment.
“We have been in close dialogue with all of our stakeholders through this process and are grateful for their continued support.
“We, of course, recognise that this affects many of our colleagues and we will do all we can to assist them during this difficult time.”