Mamas & Papas reveals plans for major restructure

MAMAS & Papas has revealed plans for a major restructuring of its UK retail business, and is hoping to agree a CVA deal with landlords of 60 stores.

The Huddersfield-based company which has just sold a stake to external investor for the first time, said it is also placing staff in a consultation process to “improve the operational efficiency” of the business.

It is understood that the company is looking to shed between 50 and 90 jobs at its head office, where it employs 440, while a further 956 are employed in its shops.

It said the proposals aim to safeguard the future of its UK retail arm in the face of a “persistently tough trading environment.”

The moves follow the conclusion of a strategic review launched earlier this year by the company.

Bosses at the company warned that margins were coming under pressure due to the challenging UK retail environment.

The firm has put proposals to the landlords of 60 of its UK stores with a view to reducing costs and ensuring a profitable retail portfolio through a Company Voluntary Arrangement (CVA) overseen by Deloitte.

Today’s announcement follows the appointment earlier this month of experienced retail executive Derek Lovelock as interim CEO and the recent investment from private equity group BlueGem.

David Scacchetti, chairman of Mamas & Papas, said: “While our international and wholesale businesses are performing strongly, the UK retail environment is the toughest I’ve experienced in the 30 years since we founded Mamas & Papas and it has become clear that we need to take action if we are to maintain our proud position as a brand trusted by parents across the world.

“We believe the proposals announced today will create a platform to allow us to continue offering innovative, premium products to customers in the UK and internationally, both in stores and online.

“Alongside the investment from BlueGem, the strengthened leadership team and the support of our colleagues, we are confident we are taking the steps necessary to protect the Mamas & Papas brand and help it to achieve its potential in the future.”

The CVA proposals relate to Mamas & Papas (Retail), the company which operates Mamas & Papas’ UK stores.

Other companies in the group are unaffected.

A vote on the proposals put forward under the terms of the CVA will be held on September 10.