Hobbycraft to close at least nine stores in restructuring plan
The owner of Hobbycraft is planning to close at least nine stores as part of a company voluntary arrangement (CVA) set to be launched this week.
Modella Capital – the private investment firm which also recently took over WHSmith’s high street arm – could close nearly a quarter of the retailer’s stores under the terms of the restructuring, Sky News has reported.
In addition to the nine stores already earmarked for closure, a further 18 could shut their doors if negotiations with landlords for lower rents fall through.
A further 97 stores will remain unaffected by the CVA.
As well as job losses at the closing stores, it is also expected that a number of roles within the head office and distribution centres could also be cut.
Modella Capital is expected to launch the Hobbycraft CVA shortly before it begins a restructuring process at discount chain The Original Factory Shop, which it acquired two months ago.
In a statement, a Modella spokesperson said: “Modella Capital is absolutely committed to bricks and mortar retail, at a time when the sector is coming under increasing pressure.
“[Modella] understands that high streets provide a vital service to consumers, are an essential source of employment and are key to the future success of local economies.
“Modella Capital believes that many retailers can thrive on the high street; particularly those with a distinctive offer and a loyal customer base.
“Where necessary, Modella Capital has the skills and experience to restructure retailers that require it, in order to ensure they create profitable, ongoing businesses that will continue to serve communities and employ thousands of people across the UK.”
Modella Capital acquired Hobbycraft from private equity firm Bridgepoint last summer.