BUSINESS

Laura's Shoppe Lives To See Another Day After Deal With Creditors

12/03/2015 12:19 EST | Updated 12/03/2016 05:12 EST
CP
TORONTO — Canadian retailer Laura's Shoppe Inc. says it has reached a deal with its creditors about the future of the company.

The Montreal-based owner of more than 140 women's clothing stores, under the various Laura banners and Melanie Lyne, filed for creditor protection on July 31 and later shuttered 15 stores in a cost-cutting measure.

The privately held company said Thursday that 96 per cent of its creditors, who own 99 per cent of its debt, signed off on the restructuring plan, which includes renovating existing stores and investments in technology.

When it filed for creditor protection, the company said it had posted large losses in 2012 and 2013 after missteps with merchandise that didn't resonate with its customers.

The company said despite returning to profitability in 2014, the move was necessary to address its existing debt.

Laura's said the restructuring plan will see stores renovated with new fitting rooms and lounge areas to enhance its by-appointment personalized shopping.

The company, which has two e-commerce sites, said it will also improve its online offerings to deliver a more personalized experience.

In early September, Laura's said it had struck deals with landlords at several malls to cut rents and that its suppliers offered significant discounts on clothes for the fall season. The company has now renegotiated more than 50 of its existing leases.

The company closed 15 stores later that month, and a further five stores will close before the end of January. The company said other savings came from eliminating jobs at its head office.

Laura's said that after the restructuring is complete, it will employ around 2,000 workers across Canada in stores, its distribution centre and its back office.

Laura's, which operates in all provinces except Prince Edward Island, was founded in 1930. Company president Kalman Fisher is the grandson of founder Laura Wolstein.