By Geoff Percival
Struggling British flooring retailer Carpetright has received the £15m (€17m) in emergency interim funding it has been seeking in order to cover short-term working capital needs.
The company operates 400 stores in the UK and 20 in Ireland. It recently secured creditor, landlord and shareholder approval for a restructuring that will see 92 stores close and 300 jobs cut. None of its shops in Ireland will close but Carpetright is shutting five in the North, more than halving its presence there.
The £15m is being provided by way of an unsecured loan from fund manager Meditor, a substantial shareholder in Carpetright, and is in addition to the retailer’s plans to raise around £60m through a share placing and open offer, due to be launched next week.
Meditor previously granted Carpetright a £12.5m unsecured loan in March, which will be repaid from the proceeds from the equity raise.
Earlier this month Carpetright said it expects to post losses of £7m to £9m this year affected by a continued reduction in consumer confidence in the UK.
Carpetright shares fell by almost 7% yesterday. It said its European sales, much of which are derived from its Irish stores, dropped 8% in the final quarter of its financial year.
In the North, the company is closing stores at Bally-mena, Bangor, Coleraine, Derry and Newtownabbey; with Belfast, Connswater and Cookstown set to remain open.