The Original Factory Shop’s new owner Modella Capital is preparing to impose steep rent cuts for the discount chain’s store landlords.
The private equity owner is finalising its plans for a company voluntary arrangement (CVA) which could be unveiled within days, Sky News reported.
It is understood that significant store closures and job losses could form part of the restructuring plans for TOFS, as well as demands for two-year rent-free periods at some branches.
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Modella, which also owns Hobbycraft and WHSmith’s high street business, snapped up TOFS’ 180 UK stores and its workforce of around 1,800 employees back in February.
Shortly after, the new owner hired advisors at Interpath to work on a restructuring plan.
Sources told the publication that dozens of the discount chain’s stores could close under a CVA. A major distribution centre is also thought to be included in the proposals.
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