Topshop empire avoids collapse but store closures put 1,000 jobs at risk
The Arcadia retail empire, which owns Topshop and Burton, last night narrowly staved off a collapse into administration after a knife-edge vote received the backing of its landlords.
It means around 1,000 jobs are at risk as 23 stores - including some in Ireland - close under a company voluntary arrangement (CVA), while another 25 will be shuttered as part of a wider restructuring.
Landlords will also receive smaller amounts of rent on certain properties, with some reduced by half.
Arcadia chief executive Ian Grabiner said: "After many months of engaging with all our key stakeholders, taking on board their feedback and sharing our turnaround plans, the future of Arcadia, our thousands of colleagues and our extensive supplier base is now on a much firmer footing.
"From today, with the right structure in place to reduce our cost base and create a stable financial platform for the group, we can execute our business turnaround plan to drive growth through our digital and wholesale channels, while ensuring our store portfolio remains at the heart of our customer offer.
"I am confident about the future of Arcadia and our ability to provide our customers with the very best multi-channel experience, deliver the fashion trends that they demand, and ultimately inspire a renewed loyalty to our brands that will support the long-term growth of our business."
The proposals were passed at a second meeting yesterday, a week after the first was postponed.
The initial vote was adjourned after it became clear there was not sufficient support among landlords.
Arcadia owner Philip Green and his wife then proposed less severe rent cuts in a bid to appease the opponents of the proposals.
However, the CVA remained contentious, with some landlords reported to have voted against.
Speaking after the meeting but before the result, Oliver Buhus from supplier Paragon Clothing said landlords had been "ruthless and self-serving".
"There's no sense of taking an initiative to act collectively, it's each landlord for himself," he said.
The proposals, which were launched last month, involve the closure of 23 stores in the UK and Ireland.
Another 11 Topshop and Topman stores in the US were earmarked for closure, while an additional 25 Miss Selfridge and Evans stores were also slated to be axed.
In total, at least 1,000 employees are likely to be affected.