Paperchase’s creditors have approved a company voluntary arrangement, which will allow the stationery retailer to close up to 28 stores.
Earlier this month, the retailer set out plans to close 28 of its 145 shops (https://www.egi.co.uk/news/paperchase-outlines-cva-plans/) as part of the proposals.
Will Wright, restructuring partner at KPMG and joint supervisor of the CVA, said: “The engagement and buy-in of all stakeholders throughout this process has been vitally important in putting together an innovative CVA proposal which, following today’s approval, will allow Paperchase to move forward with a financial and operational restructuring plan.
“Today’s vote saw a majority of all voting creditors choosing to approve the CVA, surpassing the 75% total required in order to pass the resolution.”
The proposals divided the stores into six categories. A total of 28 category 5 and 6 sites will experience a 50% rent reduction for three months, following which there will be either a rent-free period or a closure and exit.
Turnover rents have been proposed at 70 sites in categories 2, 3 and 4, with guaranteed minimum base rents ranging from 35% to 80%. Of its estate, 45 sites in category 1 will largely remain unchanged.
Figures from Radius Data Exchange show that Paperchase’s portfolio measures 329,000 sq ft.
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