Shropshire stores saved as Homebase reveals 42 more closures

Staff at the Telford and Market Drayton branches will keep their jobs as a result, but around 1,500 workers across the UK could now lose their jobs.

The retailer is closing the stores via a Company Voluntary Agreement (CVA), a controversial insolvency procedure used by struggling firms to shut under-performing shops.

Restructuring experts at Alvarez & Marsal will carry out the CVA, which will require the support of landlords.

Homebase said the 42 stores listed below would close later this year or early in 2019 and that around 1,500 roles would be lost as a result.

It said "every effort" would be made to find staff roles elsewhere in the business.

In the meantime all UK stores will stay open as usual and Homebase said there would be no impact on customer purchases or outstanding orders.

Closures

It was first reported in June that Homebase was exploring further store closures through the procedure.

The latest restructuring would come on top of a store closure programme the retailer has been carrying out since February.

A total of 16 Homebase stores have already been shut this year and the business has also axed 303 jobs at its head office in Milton Keynes.

Back in 2013 Homebase had branches in Oswestry, Shrewsbury, Whitchurch, Telford and Market Drayton but now only the latter two remain. The next closest branches in Wolverhampton and Wrexham are also going to stay open.

Difficult decision

Homebase could see some resistance from landlords to the CVA, with the property industry expressing disdain for the procedure, saying it leaves them out-of-pocket.

Creditors will vote on the CVA on August 31.

Damian McGloughlin, CEO of Homebase, said: “Launching a CVA has been a difficult decision and one that we have not taken lightly.

"Homebase has been one of the most recognisable retail brands for almost 40 years, but the reality is we need to continue to take decisive action to address the underperformance of the business and deal with the burden of our cost base, as well as to protect thousands of jobs.

"The CVA is therefore an essential measure for the business to take and will enable us to refocus our operations and rebuild our offer for the years ahead.”

CVAs

CVAs have been adopted by a host of retailers including New Look, Carpetright and Mothercare.

The Homebase store closures follow the sale of the business earlier this year by its former Australian owner Wesfarmers to Hilco, a retail turnaround specialist, for £1.

Homebase was bought by Wesfarmers for £340 million in 2016.

Wesfarmers is known for its Bunnings chain in Australia, and attempted to import the home improvement brand to the UK by converting a host of Homebase stores into the Bunnings format.

However, the strategy ended in disaster.

Prior to the Hilco takeover, Homebase had 250 stores at its peak and 12,000 staff.

The stores earmarked for closure are:

1. Aberdeen Bridge of Don

2. Aberdeen Portlethen

3. Aylesbury

4. Bedford St Johns

5. Bradford

6. Brentford

7. Bristol

8. Canterbury

9. Cardiff Newport Road

10. Croydon Purley Way

11. Droitwich

12. Dublin Fonthill

13. Dublin Naas Road

14. Dundee

15. East Kilbride

16. Exeter

17. Gateshead

18. Grantham

19. Greenock

20. Hawick

21. Inverness

22. Ipswich

23. Limerick

24. London Merton

25. London New Southgate

26. London Wimbledon

27. Macclesfield

28. Oxford Botley Road

29. Peterborough

30. Pollokshaws

31. Poole Tower Park

32. Robroyston

33. Salisbury

34. Seven Kings

35. Solihull

36. Southampton Hedge End

37. Southend

38. Stirling

39. Swindon Drakes Way

40. Swindon Orbital

41. Warrington

42. Whitby