Fresh doubt over Mothercare at Merry Hill
Fresh doubt has been cast over the future of a Mothercare branch at the Merry Hill shopping centre.
It is part of a Mothercare subsidiary called Children's World, made up of 22 stores, and which the company has now put into administration as part of its radical bail-out plan. It aims to close nine of the shops but refuses to say which ones are affected.
The move now means a total of 60 Mothercare outlets will be shut by June next year, putting 900 jobs at risk. That already includes stores in Stafford and Walsall, where around 30 people work.
The retailer said 13 of the Children's World arm's 22 stores, which all together employ 336 people, would be saved. It is thought the nine closures add around 100 to the jobs toll.
Mothercare bought Children’s World from Boots in January 1996 and re-branded all of its superstores as Mothercare World, including the outlet at the Merry Hill retail park, off Pedmore Road, Brierley Hill.
The changes come after Mothercare cleared a restructuring plan known as a Company Voluntary Agreement (CVA), an insolvency procedure that required the approval of the retailer's landlords.
The group has also managed to raise £32.5 million from its existing shareholders.
Mothercare has identified savings of £19 million through the process, and hopes to realise £10 million in cash.
Clive Whiley, Mothercare's interim executive chairman, said: "When I joined the business just three months ago, Mothercare faced a bleak future with growing and pressing financial stresses upon the business.
"We have worked tirelessly as a team to get to where we are today and this fully underwritten equity issue marks the end of this initial phase, returning the group to financial stability."
Mothercare fired its chief executive, Mark Newton-Jones, in April, but he was later brought back to see the business through its CVA.
Speaking about his dismissal, Mr Newton-Jones said: "I think it is probably fair to say I would like to have not left in the first place.
"I have come back to finish off what we started four years ago."
He said the UK market was "frankly quite brutal" and that Mothercare was looking for opportunities to grow sales internationally.
In May, Mothercare revealed it had swung to a £72.8 million pre-tax loss in the year to March 24, compared to a £7.1 million profit in 2017.
The store closures come at a dismal time for the high street.
Since January, Toys R Us and Maplin have filed for administration, while fashion retailers such as House of Fraser, New Look, Carpetright and others have embarked on radical store closure programmes.