River Island fails to secure creditor approval over restructuring plan

British retailer River Island has failed to secure crucial approval from its creditors for its proposed restructuring. The rescue plan now rests on a High Court judge who will make a formal decision on the matter on July 7.

Despite around 80 percent of the retailer’s creditors by value choosing to support the plan, River Island was unable to secure 75 percent of the vote for every individual class creditor, according to the Telegraph.

The retailer needed at least three quarters of its creditors to approve of the plan in order to receive an emergency loan from the Lewis family, its founders. The media outlet noted that some landlords withheld support.

In spite of the setback, River Island remains confident in eventually receiving approval. In a statement to the Telegraph, a spokesperson for the retailer said: “River Island circulated its proposals for 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 we are confident that we will achieve the approval of the plan in the coming days.”

In a plan laid out by advisors at PwC, River Island is seeking to close 33 of its 230 stores, while further cutting the rents on 71 locations.

Last month, the retailer told creditors it could collapse “within weeks” if its “radical” rescue plan wasn’t put into place, with money potentially at risk of running out by the end of August.