High Street shopping chain New Look said it is negotiating with landlords in a new bid to mend its finances after the coronavirus lockdown hit sales at its stores.

It wants landlords to accept rents based on the sales stores generate rather than at a pre-arranged rate.

The move is the second major overhaul of the company in three years.

New Look says 459 out of its 496 stores have re-opened. But sales at reopened stores are 38% lower.

Founded 1969 with first store in Taunton, Somerset, the women’s clothing chain has had a difficult few years.

It closed stores and agreed rent reductions in 2018 through a company voluntary arrangement (CVA), a process it will also use this time.

“Out of absolute necessity, we are preparing to launch a CVA that would reset our rental cost base back to market rent through a turnover-based model that fairly reflects the future performance of the company and wider retail market,” it said. The process will be started later this month.

New Look says it has already agreed a plan with its lenders to strengthen its finances.

It aims to slash its debts from £550m to about £100m to cut the amount it is paying on interest.

“However, this recapitalisation – which will enable us to deliver our long-term strategic plans and safeguard 12,000 jobs – can only be delivered if we secure the support of our landlords for our forthcoming CVA,” said chief executive Nigel Oddy.