Struggling fashion and home retailer Laura Ashley is in talks with its lender about securing enough money to allow the brand to continue trading.
Laura Ashley said the talks between majority shareholder MUI Asia and US bank Wells Fargo came after a tough period in the last six months of 2019, during which sales fell by 10.8 per cent, to £109.6 million.
The discussions are aimed at finding a way for the business to access the cash it needs to meet "immediate funding requirements" as well as capital for the short to medium term.
Laura Ashley's poor performance has put pressure on the company's share price, with shares falling by 41 per cent.
The retailer has also been restricted to how much it can draw from the loan facility it has with the US bank, Wells Fargo.
MUI Asia chairman Andrew Khoo said, "We acknowledge that recent trading conditions, in line with the overall UK retail market, have indeed been challenging."
He added there was a "robust plan" in place to turn the business around.
"The major shareholders have indicated their continued confidence in the business and are fully supportive of the management team and execution of the transformation plan," Khoo said.
Tough trading conditions
In December 2018, Laura Ashley earmarked 40 stores for closure, amid tough trading conditions on the UK High Street.
"If the group remains unable to access the requisite level of funding, then the company will need to consider all appropriate options," Laura Ashley said at the time.
Founded in 1953, Laura Ashley was a prominent name on the UK high street and one of the world's leading clothing brands in the 1970s and 1980s.
But it has struggled to stay relevant, with the company's share price tumbling 90 per cent over the past five years.