Supermarket chain owners could be forced to inject cash to retain control
UPMARKET grocer Booths could be forced to invest more money after coming close to breaching the terms of its bank loans, according to reports in the national press.
Royal Bank of Scotland and HSBC, the company’s senior lenders, have instructed accountants Grant Thornton to undertake an Independent Bank Review.
An IBR can often lead to the owners of a company having to make a one-off cash injection to retain independence or the banks eventually taking control.
It was ordered after Booths came close to breaching the terms of its loans, according to.
The chain, which has 31 shops around the North West including stores in Ulverston, Windermere and Kendal, made a £6.3m loss in 2016 compared to a £1.1m profit the previous year.
Edwin Booth, a fifth generation family member, has taken on the dual role of chairman and chief executive after Chris Dee, the previous chief executive, left abruptly in May following 22 years of service.
He said: “Booths is a resilient 170 year family owned retailer with strong brand loyalty and leadership in place. These are turbulent times for the retail industry, which is rife with conjecture and speculation.
"We have an effective plan and team in place to ensure Booths remains a much loved retailer for our customers here in the North. We’re focusing on delivering the best service, products and value to our customers.”
As part of a cost saving exercise a layer of senior management has been removed, which resulted in £1.6m of one-off costs but is expected to save £2.6m a year.
The changes led to 100 job losses, although new openings in Barrowford and Hale Barns are said to have created around 400 new full and part-time positions.