The BBC has reported that the high-street stationery retailer Paperchase has proposed a restructuring which includes five store closures.
Of its 145-strong fleet of shops, another 23 stores are at risk as it tries to cut its rents by 50%.
Advisers at KPMG have put together plans which state that at 70 locations, stores will be subject to turnover-linked rents. For these sites, landlords will receive between 35% and 80% of the original rent, depending on the store.
Will Wright, restructuring partner at KPMG and the person overseeing the CVA, said the deal gives the firm: "the ability to rationalise its store portfolio by exiting stores that are unprofitable, secure rent reductions where stores are over-rented and implement turnover rents to reflect the highly seasonal nature of the business.”
Wright continued: “Over the last 50 years, Paperchase has grown to become one of the UK’s most well-known and innovative design-led stationery retailers.
“However, like many other businesses in the retail sector, the company has been adversely affected by a cocktail of well-documented issues, including a reduction in footfall, increased rents and business rates, and margin pressure from sterling depreciation.”
Creditors will vote on the proposals on 22 March. Paperchase needs to secure at least 75% creditor approval for the CVA to proceed.