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Homebase in Croydon is going to close next month

Homebase in Croydon is going to close next month
Aug 07, 2018 Shaking Hands 0 comments
This post was first published by Croydon Advertiser on 06/08/2018.

Homebase in Croydon is going to close next month

Hundreds of the chain’s staff are losing their jobs as up to 40 branches across the country are closed.

Croydon’s only Homebase store will close next month as hundreds of the chain’s employees across the country face being made redundant.

The DIY chain, which has a store located on Purley Way, has said the borough’s one and only branch will shut permanently on Friday, September 21.

The Croydon branch is one of up to 40 stores across the UK which have been earmarked for closure in the near future.

Homebase has now promised to offer “continued support” to those who will be losing their jobs.

A spokeswoman for the chain said: “We can confirm that our store in Croydon is set to close on September 21.

“Our priority now is to continue supporting team members.”

The Advertiser has asked Homebase how many jobs are going to be lost.

Wesfarmers, which previously owned Homebase, said in February that trading at the chain has been “poor”, and outlined plans to close up to 40 of its worst performing stores this year.

Bunnings, who are owned by Wesfarmers, acquired Homebase in 2016 in a £340 million deal and had been attempting to rebrand the company as Bunnings – which is a household hardware chain in Australia.

But Australian owner Wesfarmers offloaded the entire 250-store Homebase chain, which has a workforce of more than 11,000 people, in May, selling the company to retail turnaround specialist Hilco for a nominal sum, thought to be £1.

The sale of the retail chain to Hilco meant the 24 stores that were trading as Bunnings on a trial basis converted back to the Homebase brand.

The closure of the Croydon store comes amid speculation Homebase is sounding out advisers over a potential company voluntary agreement (CVA).

Reports suggest restructuring experts at Alvarez & Marsal were being scouted by Homebase for the CVA, although other options were being assessed alongside this.

A restructuring would come on top of the store closure programme that the retailer has been carrying out since February 2018.

So far, a total of 17 Homebase stores have been shut, with another 23 earmarked for closure.

And last month it was announced Homebase was cutting 300 jobs at its Milton Keynes head office, with a third of its staff leaving the company before November, as part of the restructuring plan.

However, it is thought that Homebase’s management are cautious about the prospect of a CVA – a legally binding agreement between a company and creditors to allow a proportion of its debts to be paid back over time – because the process is so controversial with creditors, especially landlords.

Homebase would have to secure the support of landlords to carry out a CVA.

The property industry has expressed outrage at the process, which has been adopted by the likes of House of Fraser, Mothercare and Carpetright, saying it leaves them out-of-pocket.

Damian McGloughlin, the chief executive of Homebase, explained the store closures and job cuts are part of the chain’s plans to rebuild.

He said: “We have not taken this decision lightly but decisive action is required to start rebuilding Homebase’s position in the UK market.

“We will be providing as much support as we can to help those affected through this difficult time.”

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