Carpetright has won approval from its creditors to go ahead with a CVA, which is expected to result in 92 store closures.
At a creditors’ meeting this morning, the CVA was approved by a majority of more than 75%.
A CVA shareholders’ meeting will be held on 30 April.
However, if shareholders do not approve the CVA, the decision of creditors will prevail, subject to the right of any shareholder to apply to court to challenge the approval of the CVA Proposal.
Carpetright has already identified 205 sites in the UK that are either underperforming, not on favourable lease terms or that are not expected to have any significant strategic value to the company moving forwards.
Some 92 sites have been earmarked for potential closure, 11 of which have already stopped trading.
Rent on a further 113 stores is expected to be reduced through the CVA process.
Chief executive Wilf Walsh, said: “Addressing our legacy property issues to reduce our fixed costs to sustainable levels is critical to securing Carpetright’s recovery.
“Receipt of creditor approval for the CVA proposal will enable us to take tough but necessary action to establish a right-sized estate of stores on economic rents, which is essential to restoring our profitability.
“Our focus now shifts to the forthcoming shareholder vote and to our preparations for the proposed equity financing which will recapitalise the business and enable Carpetright to address the competitive threat from a position of strength.”
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