The 33 River Island stores facing closure have been revealed as the struggling high street fashion chain won approval for cuts putting hundreds of jobs at risk.
Major retailer River Island announced the shutdowns as part of a ‘restructuring plan’ aimed at staving off going into administration.
The 33 outlets now facing closure from next January onwards range from across the UK, including London as well as in Northern Ireland, Scotland and Wales, while the clothing retailer will also now pay reduced rents on 71 further shops.
The plans have now been approved by London’s High Court, where Matthew Weaver KC, representing River Island, told how the firm had ‘simply not been able to reverse’ its ongoing financial struggles.
The sweeping proposals have been put together by accountancy firm PwC, which is advising the retailer – and the stores set to go next year are revealed below.
An 800-page report compiled by PwC revealed how the fashion house facing a £10million ‘funding need’ in the second week of September, which financial experts warn will skyrocket to £50million before Christmas.
The plan would allow River Island to walk away from a string of debts, including tens of millions of pounds owed to landlords from outstanding debts.
Among those landlords affected by the restructuring deal are British Land, the Crown Estate and Mike Ashley’s Frasers Groups – while councils nationwide would also be on the list.
Major chain River Island announced 33 store shutdowns as part of a part of a ‘restructuring plan’ aimed at staving off going into administration
High street fashion chain River Island is planning to shut 33 stores, with 71 more at risk, putting thousands of jobs on the line. Pictured: file image
Bosses at the company have blamed the proposed closures on a ‘migration of shoppers from the High Street to online’ and higher costs to run stores.
River Island, which employs around 5,500 people, was founded in 1948 under the Lewis and Chelsea Girl brand before rebranding in the 1980s.
It is now headed up by CEO Ben Lewis, the nephew of its founder, who took over his second stint as the head of the family firm in February – having previously held the position for almost a decade before stepping down in 2019.
Mr Lewis today welcomed the High Court’s approval for a deal that had been agreed last Friday by five of the company’s 10 classes of creditors.
He told of being ‘pleased that River Island’s restructuring plan has been approved by the High Court’.
He added: ‘We have a clear transformation strategy to ensure the long-term viability of the business, and this decision gives us a strong platform to deliver this.
‘Recent improvements in our fashion offer and shopping experience are starting to show results, and the restructuring plan will enable us to align our store estate to our customers’ needs.
‘We are grateful to our suppliers, landlords and other stakeholders for their constructive engagement and shared confidence in River Island’s future.’
River Island had reportedly faced collapse in weeks without a rescue deal being approved
River Island, which employs about 5,500 people, was founded in 1948 under the Lewis and Chelsea Girl brand before rebranding in the 1980s – seen is a branch in London’s Oxford Street
The firm’s lawyer Mr Weaver had told the High Court: ‘In essence, the transformation plan seeks to address the root causes of the difficulties facing the group and to reposition River Island for long-term success.
‘It involves a combination of operational improvements, cost rationalisation and strategic investment, all of which are critical to restoring profitability, improving cash flow, and safeguarding jobs.’
The restructuring plan has now been given the green light by Sir Alastair Norris, with a full written judgment expected at a later date.
Mr Lewis had previously said: ‘River Island is a much-loved retailer, with a decades-long history on the British High Street.
‘However, the well-documented migration of shoppers from the high street to online has left the business with a large portfolio of stores that is no longer aligned to our customers’ needs.
‘The sharp rise in the cost of doing business over the last few years has only added to the financial burden.
‘We have a clear strategy to transform the business to ensure its long-term viability.
‘Recent improvements in our fashion offer and in-store shopping experience are already showing very positive results, but it is only with a restructuring plan that we will be able to see this strategy through and secure River Island’s future as a profitable retail business.
‘We regret any job losses as a result of store closures, and we will try to keep these to a minimum.’
The high street giant is among several fashion chains hit hard by weaker consumer spending and fierce competition from cheaper online rivals like Shein.
In its latest accounts, River Island reported a £33.2million loss for 2023, with sales down 19 per cent.
In January, the firm introduced a redundancy programme at its London head office in a bid to save money in the context of increasingly pressured finances.
The job cuts affected a range of employees across buying, merchandising and HR, but the total number of losses was not confirmed by the retailer.
A River Island spokesman told the Daily Mail last month: ‘River Island circulated its proposals for a Restructuring Plan to creditors on June 20.
‘In combination with the company’s ongoing transformation strategy, the plan is a proactive measure to place the company on a firm footing.
‘We have been having positive conversations with key stakeholders and are confident that we will achieve approval of the Plan in the next few weeks.’
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