House of Fraser has announced that the company voluntary arrangement (CVA) proposals launched on 6 June have been approved by the company’s creditors.

The CVA enables House of Fraser to restructure its business to secure its future and access new capital from international retailer C.banner. The retailer hopes that the move will provide a more sustainable cost base and a platform for future growth.

House of Fraser will now begin the process of working with landlords and other stakeholders to implement the proposals, including the 31 stores identified for closure. All stores identified for closure are anticipated to trade until early 2019.

Frank Slevin, chairman of House of Fraser, said that the CVA approval is a seminal moment in the retailer’s history. “We must now continue with the implementation of our restructuring plan. This is also an important milestone in the transaction with C.banner and moves us toward the completion of the capital injection first announced in May.”

Alex Williamson, chief executive of House of Fraser, added: “This was clearly a difficult decision to take but is, ultimately, the only one to secure our future. Our focus is on supporting all of our affected colleagues and we are exploring every opportunity available to them working alongside the Retail Trust and the wider retail community.”

Chris Field, chairman at Retail Connections, said the move makes it clear that tenants and landlords need to rethink retail stores with new models for profit.

"Rent, rates and lease agreements that make up the retail property market have failed to keep pace with the shape of modern retailing - it’s the classic landlord tenant dilemma – neither see the other’s point of view and the relationship is primarily adversarial,” he stated.

“Flexible and shorter-term leases will scare many landlords, but if they are pitched on the basis that the retail centre is constantly freshened up with new tenants and new ideas, then queues to rent will start to form and the landlord need no longer panic about short leases,” concluded Field.

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