Hundreds more high street jobs are being put at risk as part of a sweeping overhaul of the family-owned fashion retailer River Island.
Sky News has learnt that the clothing chain, which trades from about 230 stores, is proposing to close 33 shops in a restructuring plan which will be put to creditors in August.
The fate of a further 70 stores is dependent upon agreements being reached with landlords to slash rent payments.
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Confirmation of the plans comes less than a month after Sky News revealed that the company, which was founded in 1948 by Bernard Lewis, was working with PricewaterhouseCoopers (PwC) on a restructuring plan.
In a statement issued on Friday, Ben Lewis, River Island’s chief executive, said: “River Island is a much-loved retailer, with a decades-long history on the British high street.
“However, the well-documented migration of shoppers from the high street to online has left the business with a large portfolio of stores that is no longer aligned to our customers’ needs.
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“The sharp rise in the cost of doing business over the last few years has only added to the financial burden.
“We have a clear strategy to transform the business to ensure its long-term viability.
“Recent improvements in our fashion offer and in-store shopping experience are already showing very positive results, but it is only with a restructuring plan that we will be able to see this strategy through and secure River Island’s future as a profitable retail business.
“We regret any job losses as a result of store closures, and we will try to keep these to a minimum.”
The company declined to comment on how many jobs would be put at risk by the initial 33 shop closures, or on the scale of the rent cuts being sought during talks with landlords.
In total, it is understood to employ about 5,500 people.
Sources said that new funding will be injected into River Island if the restructuring plan is approved in August.
Previously named Lewis and Chelsea Girl, the business, it adopting its current brand during the 1980s.
Accounts for River Island Clothing Co for the 52 weeks ended 30 December 2023 show the company made a £33.2m pre-tax loss.
Turnover during the year fell by more than 19% to £578.1m.
A restructuring plan is a court-supervised process which enables companies facing financial difficulties to compromise creditors such as landlords in order to avoid insolvency proceedings.
An identical process is being used to close scores of Poundland shops and slash rents at hundreds more.
In its latest accounts at Companies House, River Island Holdings Limited warned of a multitude of financial and operational risks to its business.
“The market for retailing of fashion clothing is fast changing with customer preferences for more diverse, convenient and speedier shopping journeys and with increasing competition especially in the digital space,” it said.
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“The key business risks for the group are the pressures of a highly competitive and changing retail environment combined with increased economic uncertainty.
“A number of geopolitical events have resulted in continuing supply chain disruption as well as energy, labour and food price increases, driving inflation and interest rates higher and resulting in weaker disposable income and lower consumer confidence.”
Retailers have complained bitterly about the impact of tax changes announced by Rachel Reeves, the chancellor, in last autumn’s Budget.
Since then, a cluster of well-known chains, including Lakeland and The Original Factory Shop, have been forced to seek new owners.
