The struggling retailer Stockmann Group plans to sell its flagship store in Helsinki and other properties, the company announced on Monday when it unveiled its restructuring strategy.
The company announced its intention to sell its stores in Tallinn, Estonia and Riga, Latvia, noting that it will continue to operate not only as properties sold as tenants but also online.
Proceeds from the sale of the properties will be used to pay off debts, the company said in a stock exchange release and stated that its debts were nearly โฌ 740 million.
The department store chain was founded in 1862, but like many of these types of retailers have struggled in recent years. Then the growing effects of the coronavirus pandemic prompted the company to apply for corporate reorganizations in the Helsinki District Court last spring.
The company had a deadline last Friday to submit a restructuring proposal, but its release was postponed to Monday.
According to Stockmann, it has negotiated new leases for its stores in Vantaa, Turku, Tampere and Espoo, as well as for its offices in Helsinki, and stated that negotiations on the store in the Helsinki ITIS shopping center are still ongoing.
CEO of the company, Jari Latvanen, he believed the restructuring plan would help the company "to achieve the best possible outcome for all parties."
"Together with other measures already taken – such as cost adjustment, the adoption of a new business strategy, streamlining of processes and a number of other operational measures – the restructuring will ensure that Stockmann has a future as a fashion pioneer, Home Goods and Beauty Products. Through the restructuring program, Stockmann will also be able to make the investments planned for 2021โ2028, which are necessary for the company’s development," Latvanen said in a company announcement.
The company said it would retain ownership of the Lindex fashion store chain and said the revenue would be lost to pay off its debts.
Source: The Nordic Page