New TOFS owner eyes potential CVA and store closures
Around 1,800 TOFS employees could lose their jobs as a result of store closures brought on by any 'landlord-led' CVA
Modella Capital, the owner of The Original Factory Shop (TOFS), is reportedly working with Interpath Advisory on a potential company voluntary arrangement, according to Sky News.
Having acquired the retailer four weeks ago with no remaining bank debt, Modella is seeking to restructure the business and is currently “exploring options”.
It is understood that a CVA would see to the closure of underperforming TOFS stores, as well as the negotiation of rent cuts on other sites. Restructuring plans also include proposals for a major distribution centre.
It is thought that any ‘landlord-led’ CVA could lead to job losses among its 1,800 workforce. However, concrete plans that include the exact date for the CVA’s launch have not yet been disclosed.
Founded in 1969, The Original Factory Shop sells brands such as L’Oreal, Adidas and Black and Decker. Private equity firm Duke Street acquired the retailer in 2007, and in present day, it trades from about 180 stores.
Duke Street had previously provided over £10m to support the business during the Covid-19 pandemic, and had attempted to sell it before.
Modella Capital is also one of two remaining bidders for WH Smith’s high street business.
Modella Capital has been approached for comment.