DavidsTea Inc. will shrink its retail store network to 18 Canadian areas as the insolvent beverage chain shutters 82 more shops in the country while handling the effect of COVID-19
The Montreal-based company states it is sending out lease termination notices for the stores and expects them to be unwinded within the next 30 days.
The move follows DavidsTea closed 82 other stores in Canada and all 42 of its shops in the United States in early July to focus on its e-commerce service and providing grocery stores and pharmacies.
The business stated at the time that it would look for more favourable lease terms for the remaining 100 shops in Canada and might permanently shut additional places if landlords are unwilling to work out appropriate leases.
DavidsTea now states it was able to secure new, more beneficial lease terms and conditions for 18 of its locations, which will resume.
The company has obtained lender protection under the Companies Lenders Plan Act (CCAA) alerted in mid-June that it might start an official restructuring depending on the result of its talks with proprietors, who had not gotten rent from DavidsTea for April, May and June.
” We believe that a select group of our best-performing stores, complementing our growing online and wholesale service design and supported by an entrepreneurial company, will boost DavidsTea’s capability to emerge from the CCAA restructuring process as a more sustainable and durable organization,” company creator, chairman and interim chief executive Herschel Segal stated.
The 18 stores are located in major shopping center. Seven are in Quebec, five in Ontario and the rest in Alberta, British Columbia, Manitoba and New Brunswick.
” Our choice to reopen these select shops is consistent with our objective to produce a leaner, more efficient company, placed for long-lasting growth.”
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