River Island considering CVA as Covid-19 hits sales
Fashion retailer River Island is reportedly considering a CVA proposal as it attempts to weather the coronavirus pandemic.
According to Retail Week, River Island is considering launching a CVA proposal or another form of administration in order to reduce rents or close some of its stores that have seen lower footfall and sales due to the impact of Covid-19.
However, according to reports executives at the company are concerned about garnering enough support from creditors in order for the proposal to be approved due to River Island’s “stable” financial position.
Under the Insolvency Act the proposal would need to be backed by 75% of creditors.
If River Island does move to close a proportion of its sites across its 300 store portfolio it would join a number of high street retailers who have struggled to keep stores open due to the pandemic.
Earlier this week, Sports retailer DW Sports collapsed into administration, placing around 1,700 jobs at risk.
BDO announced that its restructuring partners, Graham Newton and Ryan Grant, were appointed joint administrators of the sportswear and fitness company on 3 August 2020.
The group currently operates 50 retail sites and 73 gyms across the UK, with 25 of its stores having closed prior to the appointment of administrators.
River Island has been contacted for comment.
