New Look warns landlords of pre-pack

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The struggling retailer has hired property consultancy CBRE in a bid to move its store portfolio to turnover-based rents, Retail Week has reported. A pre-pack plan has been threatened if those discussions are not successful. 

The move would allow the existing owners to retain control of the firm but could also mean the retailer would be able to exit onerous leases and negotiate new deals.

A New Look spokeswoman said: “We are committed to seeking a consensual agreement with landlords to move to turnover rents, and to work in partnership with them as we continue to navigate these incredibly challenging and uncertain times together.”

A pre-pack administration would be the retailer’s second financial restructuring in less than two years, following a debt-for-equity swap with stakeholders in January 2019. 

New Look is understood to have withheld rents for the March and June quarters.

Drapers understands the retailer has recommenced rent payments on a turnover basis for stores that are open and trading. It has also recommenced payment of service charges in full from the date those stores opened.

The retailer currently employs around 12,000 people in the UK and Ireland. 

Read the Drapers Interview with New Look CEO Nigel Oddy here. 

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