River Island has warned it could collapse unless landlords back a restructuring plan that includes closing 33 stores and significantly reducing rent payments. The fashion retailer said it needs £10 million in funding by the second week of September, a figure that could rise to £50 million by the end of the year.
In documents outlining the plan, first announced in June, River Island told creditors that without approval of the rent reduction proposals via a vote and court hearing expected next month, it could run short of cash by the end of August and be “unable to pay its debts as they fall due”. This would render the company unable to continue trading as a going concern, leading to administration or other insolvency proceedings.
The retailer blamed its difficulties on a sharp rise in the cost of doing business over recent years and the shift to online shopping, which left it with a large store portfolio no longer aligned with customer needs. The warning comes despite a strong spring for fashion retailers, following a difficult 2024 and early 2025 as households cut back on non-essentials.
River Island said it has secured £40 million in new funding from the investment vehicle of the Lewis family, the company's founders who still control the business. A spokesperson said they have been having positive conversations with key stakeholders and are confident of achieving approval in the next few weeks. Blue Coast Capital, the retailer’s largest lender with outstanding debts of £270 million, has agreed to a interest rate payment holiday and to extend the repayment date on existing debts from 2027 to 2028.
The company swung to a £33.2 million loss in 2023, after sales fell more than 19% to £578.1 million, compared with a £2 million profit in 2022. It launched a cost-cutting programme in January, including redundancies at its London head office.
