Hotter Shoes has confirmed it has submitted a Company Voluntary Arrangement (CVA) proposal to creditors and shareholders to seek approval for the closure of 46 stores.
After initially announcing its’ plans in June 2020, the company seeks to reduce its’ store estate from 61 to 15.
The CVA will result in a number of redundancies but will save 350 jobs.
If approved, the expected completion date of the CVA is 1 March 2021.
Following the emergence of the COVID-19 pandemic, the management of Hotter had been in discussion with a number of its retail landlords to seek agreement to reduce the number of stores to a level and cost that allows Hotter to remain viable.
Individual discussions have been unsuccessful in obtaining the required level of agreement to allow Hotter to continue on a viable basis, pushing the company to enter into a CVA process.
In parallel with this process, Hotter has entered into formal consultation with a number of employees at its Skelmersdale head office that may lead to a number of redundancies.
Neil Johnson, Hotter’s private equity owner Electra’s Chairman, commented: “Before the pandemic hit, Hotter, under new Chief Executive Ian Watson, was making good progress to accelerate the implementation of a digitisation strategy to return it to its direct marketing routes.
“The need for these actions has been intensified by the consequences of the past 3 months of lockdown. If successful, the proposed CVA will result in fewer stores, which will secure the future of a smaller, sustainable business and will save over 350 jobs. I would like to thank all our colleagues at Hotter for their continued understanding at this difficult time”.