Arcadia bosses have reportedly told landlords it only needs 300 stores to stay afloat, despite more than 500 branches in the country.
The company, which owns Topman, Dorothy Perkins, Burton and Outfit, said it only needs 300 shops as a “critical mass” in the future, despite originally claiming a rescue plan would result in just 23 closures.
The fashion chain behind Topshop has 566 stores in the UK and is asking landlords to support a plan that will slash its rent costs.
Today, landlords and bosses held a meeting to vote on seven separate company voluntary arrangements (CVA) that could determine the future of 18,000 workers at the company.
An outcome of the crucial vote is expected at 4pm on Wednesday - it comes after initial talks with landlords failed to reach an agreement earlier this month.
Sources close to the CVA process said that the vote was “on a knife-edge and impossible to call”.
According to the Telegraph, Arcadia chairman Jamie Drummond-Smith told a room of about 40 people near St Paul's in central London than an insolvency of the fashion chain would be “catastrophic”, but advisers at Deloitte had been planning for it.
On Tuesday, it emerged shopping centre owner Intu remained unconvinced by the proposals and was planning to vote against.
The company, which owns major shopping centres including Lakeside and the Trafford Centre, holds an average of 15% of the votes across the seven CVAs that make up the planned restructuring.
Approval of the restructuring requires that all seven votes are approved by at least 75% of creditors.
Without the backing of the property giant, which owns the Trafford Centre in Manchester and the Lakeside in Essex, the vote could spell bad news for Arcadia.
Landlords are generally reluctant to vote in favour of CVAs not only because they result in a direct reduction of rental income but also because allowing one retailer to renegotiate its rent bill could spark similar demands from other tenants.
"With the traditional British high street struggling in recent years, and both Debenhams and House of Fraser recently calling in the administrators, news of the Arcadia Group potentially entering administration itself should perhaps come as no surprise," explained Vishal Makkar, head of retirement consulting at pensions consultancy, Buck.
"But, surprising or not, Arcadia’s closure will have some very real implications for thousands of people. With up to 18,000 jobs at stake and a pension scheme deficit of £750m, Arcadia’s staff face the prospect of redundancy and a sizeable cutback in pension benefits, if the Group falls into the Protection Pension Levy (PPF).
“The impending vote on the proposed CVAs means it is more crucial than ever to ensure quick steps are taken to protect the pension income of scheme members.
“The result of today’s vote will undoubtedly be watched with anticipation by many parties, but not least so, the workers at Arcadia and all those whose pension benefits are in the balance.”
