Select administrator Quantuma has filed proposals for a Company Voluntary Arrangement (CVA) to rescue Genus UK Ltd which trades as high-street womenswear retailer Select.
The company, which operates 169 stores across the UK and trades as a value fashion retailer, targeting 18-35-year-olds with up to 4,000 fashion products, fell into administration earlier this month.
Business advisory firm Quantuma were appointed as administrators on 9 May with Andrew Andronikou, Brian Burke and Carl Jackson overseeing the process. The administrators will continue to operate the business with support from its parent company, as they seek to rescue the business and preserve jobs.
In a statement this morning (28 May), Quantuma said the CVA proposal does not propose the immediate closure of any of Select’s stores and does not propose that any immediate redundancies are made. It noted, however, “some may occur even if the proposal is approved”.
“The business experienced a sharp downturn in fortunes at the end of 2018. Low levels of consumer confidence, together with Brexit uncertainty and volatile currency, have meant that sales remained subdued in early 2019. The inevitable result was a squeeze on cash flow,” Andronikou said.
“The turnaround plan embarked upon by the management delivered benefits but had not reached sufficient maturity to protect the business from this impact in the market. There remains the opportunity, with the support of its parent company, to bring these to fruition and in doing so return the business to a stable and profitable position.
“As joint administrators, we have arrived at the view that a CVA offers the best outcome for creditors as a whole. The proposal does not outline the immediate closure of any of the company’s stores, and any immediate redundancies, however, some may occur even if the proposal is approved.”
If the proposal is not approved, Andronikou said it is anticipated that the company will remain in administration and, in the event a suitable offer is not received to acquire the business, Quantuma, will have to consider ceasing its trading activities.
A meeting has been convened for 11 June at which the company’s creditors will vote on the company’s future.