British footwear chain Clarks has been rescued by Hong Kong-based private equity firm LionRock Capital, which is investing £100 million after a deal as part of which the former will enter a form of administration called a company voluntary agreement (CVA). Clarks, which has 320 shops across the United Kingdom, said no shops would be permanently shut and no jobs would be lost.

Somerset-based Clarks has struggled this year because of the impact of the novel coronavirus pandemic.

The CVA means landlords will have to accept a percentage of a shop's revenue for their rent instead of relying on a fixed lease.

The move was a ‘complete necessity’, Philip de Klerk, interim finance chief at Clarks, was quoted as saying by British media reports.

If successful in a shareholders' vote next month, LionRock will buy a majority stake in Clarks, with the Clark family no longer the main shareholders, although they will remain investors.

Clarks first began making shoes in Street 195 years ago. In 2019, it closed its only remaining UK factory, which had opened in 2017 solely to make desert boots. Before that, the last remaining Clarks plant in the UK, Millom in Cumbria, closed in 2006 as production was moved to the Far East.

Clarks shops are not counted as essential under the lockdown rules which begin at midnight tonight so will be closing, but they can still offer a click-and-collect service.

Fibre2Fashion News Desk (DS)

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