River Island has warned that it could collapse by the end of the summer unless landlords approve a proposed restructuring plan that would see the closure of 33 stores, significant reductions in rent, and a need for at least £10 million in funding by September.
In documents detailing the plan—first unveiled in June—the high street fashion retailer told creditors that unless the proposals are passed, it may run out of cash by the end of August, rendering it unable to pay its debts as they fall due. A vote on the proposals and a court hearing are expected next month.
Without landlord support, River Island said it would no longer be able to continue as a going concern and would be forced to enter administration or other insolvency proceedings.
The company blamed its deteriorating finances on “a sharp rise in the cost of doing business” and the ongoing shift toward online shopping, which has left its existing store estate misaligned with customer behaviour.
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