The household behind River Island, the excessive road style retailer, is drawing up a radical rescue plan which may put vital numbers of shops and jobs in danger.
The proposals, that are anticipated to be finalised inside weeks, are topic to sign-off, with sources insisting this weekend that any agency selections about the way forward for the enterprise have but to be taken.
River Island is one among Britain’s best-known clothes chains, working roughly 230 shops throughout the nation, and using roughly 5,500 folks.
Beforehand named Lewis and Chelsea Lady, the enterprise was based in 1948 by Bernard Lewis, lastly adopting its present model 4 many years later.
Accounts for River Island Clothes Co for the 52 weeks ended 30 December 2023 present the corporate made a £33.2m pre-tax loss.
Turnover in the course of the yr fell by greater than 19% to £578.1m.
A restructuring plan is a court-supervised course of which permits firms dealing with monetary difficulties to compromise collectors akin to landlords as a way to keep away from insolvency proceedings.
Lately, it has been utilized by firms together with the informal eating chain Prezzo and, extra just lately, Hobbycraft, the retailer now owned by Modella Capital.
One supply stated that if it proceeded, a restructuring plan at River Island may emerge inside weeks.
This weekend, it was unclear what number of shops and jobs could be below risk from a proper rescue deal.
In its newest accounts at Corporations Home, River Island Holdings Restricted warned of a large number of monetary and operational dangers to its enterprise.
“The market for retailing of fashion clothing is fast changing with customer preferences for more diverse, convenient and speedier shopping journeys and with increasing competition especially in the digital space,” it stated.
“The key business risks for the group are the pressures of a highly competitive and changing retail environment combined with increased economic uncertainty.
“Plenty of geopolitical occasions have resulted in persevering with provide chain disruption in addition to vitality, labour and meals value will increase, driving inflation and rates of interest increased and leading to weaker disposable revenue and decrease client confidence.”
AlixPartners’ position is now understood to have been outmoded by that of PwC.
Retailers have complained bitterly concerning the influence of tax modifications introduced by Rachel Reeves, the chancellor, in final autumn’s Funds.
Since then, a cluster of well-known chains, together with Lakeland and The Authentic Manufacturing facility Store, have been compelled to hunt new homeowners.
Poundland, the low cost retail large, is within the latter levels of an public sale course of, with Hilco Capital and Gordon Brothers remaining desirous about buying it.
A spokesperson for River Island declined to remark.
