Joules 'explores CVA' option - report
Struggling Joules is reportedly exploring options for a company voluntary arrangement (CVA) as it seeks to cut its costs and stave off a collapse following the termination of talks for Next to take a stake in the business.
The stock exchange-listed company is working with Interpath Advisory on a possible CVA, Sky News reported. If it happens, it could mean store closures, rent reductions on its remaining stores and — inevitably — job cuts.
Sky cited a “retail industry insider” saying a final decision hasn’t been taken on a CVA or other restructuring but the firm — under still-new CEO Jonathon Brown — was “seriously looking” at its options.
The company currently has around 130 stores, plus a webstore, and employs over 1,000 people.
It had said earlier in September that it was assessing its ongoing financing needs and considering the choices open to it. One of these would potentially be an equity raise, although analysts said they doubted its chances on this front given its well publicised problems and collapsed share price.
The news that Next might take a stake had held out a lifeline to it, but as the share price continued to fall, Next walked away.
Joules hasn’t commented on the report but if it did opt for a CVA, it would need its creditors to approve its plans.
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