List of High Street River Island Outlets Closing Down - Potential Loss of Hundreds of Jobs
River Island Secures Lifeline with High Court-Approved Restructuring Plan
River Island, the high street fashion chain, has received a much-needed reprieve following the approval of its restructuring plan by the UK High Court. The plan, which was proposed in June, aims to stabilize the company's deteriorating financial position and prevent it from going into administration.
The restructuring plan involves the closure of 33 stores across the UK, including locations in Hereford, Kilmarnock, Kirkcaldy, Leeds Birstall Park, Lisburn, Northwich, Norwich, Oxford, Perth, Poole, Rochdale, St Helens, Stockton On Tees, Surrey Quays, Sutton Coldfield, Taunton, Workington, Wrexham, and more. Additionally, rent reductions have been negotiated for 71 stores, with 38 stores seeing rents cut by 25% to 75% for 36 months, 24 stores paying zero rent, and 9 continuing to pay full rent.
This court-approved plan unlocked a £40 million lifeline loan from the Lewis family's investment company, Blue Coast Capital. This financial support will help River Island avoid an imminent cash flow collapse and administration risk.
The restructuring plan has been met with opposition from some landlords, including major property owners like British Land and the Crown Estate, who rejected the restructuring terms. However, the court sanctioned the plan despite creditor dissent, setting a legal precedent for restructuring plans that "cram down" landlord interests.
River Island's struggles stem from a variety of challenges, including supply chain disruptions, rising energy costs, wage inflation, and declining footfall due to shifts to online shopping. These factors have made the company's previous cost base unsustainable.
The restructuring plan also includes measures to address the root causes of River Island's difficulties and reposition the company for long-term success. This includes operational improvements, cost rationalization, and strategic investment.
The restructuring process is expected to result in over 200 job losses in total during 2025, with further redundancies announced recently. The total number of job losses due to the redundancy program was not confirmed by the retailer.
River Island was founded in 1948 under the Lewis and Chelsea Girl brand and was rebranded in the 1980s. The current CEO, Ben Lewis, is the nephew of the company's founder and has been in the position since February 2021.
Despite the challenges, River Island reported a £33.2 million loss for 2023, with sales down 19%. The company is hopeful that the restructuring plan will help it navigate these tough times and secure a brighter future.
[1] The Guardian, "River Island restructuring plan wins court approval", link [2] Sky News, "River Island to close 33 stores and cut 200 jobs as part of restructuring plan", link [3] BBC News, "River Island to close 33 stores and cut 200 jobs", link
- River Island's restructuring plan, approved by the UK High Court, involves the closure of 33 stores and negotiated rent reductions for 71 others, aiming to stabilize the retailer's financial position in the face of challenges posed by industry trends and general news matters.
- The court-approved restructuring plan has provided a £40 million lifeline loan from Blue Coast Capital, a strategic move that helps the retail business avoid immediate cash flow collapse and potential administration.
- Landlords, including British Land and the Crown Estate, have expressed opposition to the restructuring terms, but the court sanctioned the plan nonetheless, setting a legal precedent for policies and legislation that could impact future restructuring processes in the business and finance industry.
- River Island, under its current CEO, Ben Lewis, is facing significant difficulties, such as supply chain disruptions, rising costs, and shifts to online shopping, necessitating a holistic restructuring strategy along with operational improvements, cost rationalization, and strategic investment for long-term success.
