Blacks has revealed a restructuring plan that could see the outdoor retailer exit agreements with landlords for 101 of its closed or closing stores.
As part of the proposed company voluntary arrangement, £7.25million has been made available to landlords of the 101 stores, which equates to approximately six months rent.
Blacks is also looking to vary the leases of the rest of its 291 stores to permit monthly rental payments for the period of 18 months from the next rent payment date.
The terms of the plan have received the backing of the Bank of Scotland, which has agreed to an extension to December 23, 2009 of the existing standstill agreement it has with Blacks, as well as making available £42.5million to the group.
“After several years of losses, Blacks embarked on a turnaround plan in early 2008,” says Blacks chief executive, Neil Gillis. “The plan successfully reduced the cost base of the business, reduced our working capital requirements, improved retail standards and created a successful new retail format.
“However, the severity of the current trading environment and the drag of the loss-making boardwear business has required a more radical set of measures to complete the turnaround of the business.
“The restructuring plan announced today and the new banking facility supporting it provide a realistic opportunity to ensure the survival of the core outdoor business, which has the potential to become a strong successful retailer.”
