Embattled Carpetright to Close 92 Stores in Restructuring

Published in

Beleaguered British floor coverings retailer Carpetright has struck an emergency agreement with its lenders to close or exit leases of at least 92 shops in a restructuring that will affect 300 jobs. Carpetright, which has warned on profits three times since December, said it was entering into a creditors’ voluntary arrangement, which is a type of restructuring plan designed to keep businesses out of formal insolvency proceedings, the Financial Times reported. The group’s shares fell as much as 24 per cent in early trading in London before recovering to trade 13 per cent lower at 36.5p, as it also announced it would raise £60m of fresh equity to reduce its debts and cover the costs associated with the CVA. Carpetright chief executive Wilf Walsh said the restructuring was necessary to exit leases on a store estate that was “over-sized” after the company, which at the time was led by founder Lord Harris of Peckham “signed a load of leases in the 1990s and early 2000s and created an over-rented and unsustainable property portfolio.” Read more. (Subscription required.)