Mothercare announces store closures and equity issue

Struggling retailer Mothercare (LON:MTC) has announced that it will close 60 of its 137 outlets and attempt to raise £32.5 million in new capital via an equity issue. The company has agreed revised terms for £62.5 million in debt facilities that are conditional on this issue taking place.

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Management warned that it looked as though trading conditions would remain challenging in the second half of the year, but said that they had now identified £19 million in achievable savings. Interim Executive Chairman Clive Whiley said that: “Whilst the lack of full approval for the Childrens World CVA was disappointing, we have now found a solution which allows us to go further and faster with the right-sizing of our store portfolio”. Mothercare shares slipped 6.28% to 26.80p (as at 11:50 BST).