Questions are being raised over the future of Mothercare after the baby retailer appointed restructuring experts KPMG to “look at options” for the business.
The firm entered into a Company Voluntary Agreement - a controversial insolvency process that allows a business to shut stores and slash rents - in 2018.
As part of that agreement, Mothercare closed more than 50 stores around the UK leaving the retailer with 79 branches in Britain.
Mothercare also sold off its Early Learning Centre brand in 2018 and fell to a £36.3million loss in the last financial year.
It has now brought in KPMG to assess its options. But one Bristol-based insolvency expert believes the news is “concerning”.
Keith Mahoney, head of dispute resolution, insolvency and employment at law firm Meade King, said: “The difficulties of Mothercare are just the latest in .
“What makes Mothercare of even more concern is the fact that it is in difficulty despite entering into a Company Voluntary Arrangement last year that led to the closure of 55 stores and the selling of its Early Learning Centre arm.
“It remains to be seen if the recent unprecedented sequence of retail failures is evidence of the cyclical adjustments of the past, a symptom of Brexit uncertainty or the inevitable result of a fundamental change in the way shoppers purchase goods, as bricks and mortar shops lose out to online competition.”
Mothercare is reportedly considering further closures, rent cuts and a sale of the remaining part of its business, according to The Mirror .
The retailer is also looking at a franchising arrangement to mirror its profitable international business.
A spokesman said: "Our immediate priority is to complete the transformation of the business with a near-term focus on evolving and optimising the ownership, structure and model for our UK retail operations as an independent franchise."
The company says it is aiming to be debt free by the end of the year.
