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Pittards, the loss-making 180-year-old leather group has announced plans for a drastic restructuring to prevent its collapse.
The soaring cost of being a UK manufacturer, while competing with rivals from low-cost countries, has been blamed.
The company proposes a CVA under the Insolvency Act, which will include a £2 million equity raising and allocation of 18.5% of its expanded equity base to its pension schemes, which will also hold a security on the Yeovil plant.
As part of the restructuring, Pittards will close its Leeds plant and shift production of shoe leather and other leather goods to Yeovil and Ethiopia.
The Ethiopian facility has been under Pittards’ management since last year.
The company has long claimed to be at the forefront of saddle designs and has also won national acclaim for supplying leather gloves to RAF pilots during the Second World War and providing leather for boots worn by England football teams.
Last year, Pittards’ pre-tax losses hit £10.4 million, after a £4 million loss in 2004. Its £1.7 million market capitalisation is dwarfed by a £32.9 million pension deficit.
Pittards is also seeking entry to the Pension Protection Fund.
Source:
RedAlert
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