The retailer House of Fraser has announced plans to shut 31 of its stores across the UK, impacting around 6,000 jobs.
The chain, which has 59 stores across the UK, will also close its flagship shop on London’s Oxford Street.
The planned closures come as part of a company voluntary arrangement (CVA) – a controversial insolvency procedure used to try and shore up struggling retailers.
A staff member, who asked not to be named, said: “It’s not a great feeling amongst staff, there’s a lot of shock.
“I don’t work for House of Fraser, I work for a concession so I hope I won’t be affected but I’ll not know if I can keep my job for another while.”
The group said it also plans to relocate its Baker Street head office and the Granite House office in Glasgow to help slash costs and “secure House of Fraser’s future”.
Shops earmarked for closure will remain open until early 2019.
Alex Williamson, chief executive of House of Fraser, said on Thursday: “Today’s announcement is one of the most important in this company’s 169-year history.
“We, as a management team, have a responsibility to take necessary steps to ensure House of Fraser’s survival, which is why we are making these proposals.
“We are fully committed to supporting those personally affected by the proposals.”
The following stores will remain open:
Gateshead Metro Centre
West Thurrock Lakeside
Reading The Oracle
Loch Lomond Shores (Jenners)
The Dublin Dundrum and Solihull stores are excluded from the proposals as they are separate legal entities, the retailer said.
Hamleys owner C.banner is being lined up to buy a 51% stake in House of Fraser and invest £70 million into what remains of the business.
But its cash injection is pledged only on the condition the retailer can agree the CVA restructuring.
Will Wright, a restructuring partner at KPMG – which is handling the CVA, warned that House of Fraser would be at risk of administration if the CVA does no go ahead.
He said: “The business has been impacted by the mounting pressures facing the UK high street, with the declining profitability of certain stores exacerbated by costly legacy leases which were originally negotiated many years ago.
“With trading conditions unlikely to materially improve in the short term, the future of House of Fraser is at significant risk unless steps to restructure the business both financially and operationally are taken.”
A raft of CVAs have been struck in recent months as retailers struggle amid surging costs, rising business rates, competition from online rivals and a slowdown in consumer spending.
Other retailers undertaking CVAs in a bid to keep trading include New Look, Mothercare and Carpetright.
Restaurant businesses have also been seeking to cut their costs with store closure programmes, with Carluccio’s, Byron and Prezzo all pushing through CVAs this year.