UK specialist retailer CHIPS is taking emergency measures to ensure its company-owned stores can survive.
The popular chain, co-managed by Don McCabe and Nik Agar, has been hurt from a lack of cashflow and has struggled to pay creditors in full.
However, it has bought itself some time by seeking a Company Voluntary Arrangement, MCV understands.
This deal allows firms to legally pay back creditors some of their owed monies from future profits – and avoid falling into administration.
CHIPS told MCV today that only its company-owned outlets are involved in the CVA, and that its franchised CHIPS stores and website are not under threat – as they are not part of Chipsworld Ltd.
According to its website, CHIPS owns 11 company-owned stores and 18 franchised outlets.
CHIPS joint MD Don McCabe told MCV in a comprehensive statement today:
"In order to nullify the ravages of the 'credit crunch' and the recession which has hit the industry over the last 18 months, and to protect Chipsworld Ltd, the company has taken the step of instigating a Company Voluntary Arrangement.
"This will affect Chipsworld Ltd and company stores ONLY and DOES NOT affect CHIPS Franchise Ltd, any franchise store or www.chipsworld.co.uk.
"No store, which operates under the CHIPS banner, will close as a direct result of the CVA."