The family behind River Island, the high street fashion retailer, is drawing up a radical rescue plan which could put significant numbers of stores and jobs at risk.

Sky News has learnt that the chain’s owners have drafted in advisers from PricewaterhouseCoopers (PwC) to devise a formal restructuring plan.

The proposals, which are expected to be finalised within weeks, are subject to sign-off, with sources insisting this weekend that any firm decisions about the future of the business have yet to be taken.

River Island is one of Britain’s best-known clothing chains, operating roughly 230 stores across the country, and employing approximately 5,500 people.

Previously named Lewis and Chelsea Girl, the business was founded in 1948 by Bernard Lewis, finally adopting its current brand four decades later.

Accounts for River Island Clothing Co for the 52 weeks ending 30 December, 2023 show the company made a £33.2m pre-tax loss.

Turnover during the year fell by more than 19% to £578.1m.

A restructuring plan is a court-supervised process which enables companies facing financial difficulties to compromise creditors such as landlords in order to avoid insolvency proceedings.

In recent years, it has been used by companies including the casual dining chain Prezzo and, more recently, Hobbycraft, the retailer now owned by Modella Capital.

One source said that if it proceeded a restructuring plan at River Island could emerge within weeks.

This weekend, it was unclear how many stores and jobs might be under threat from a formal rescue deal.

In its latest accounts at Companies House, River Island Holdings Limited warned of a multitude of financial and operational risks to its business.

“The market for retailing of fashion clothing is fast changing with customer preferences for more diverse, convenient and speedier shopping journeys and with increasing competition especially in the digital space,” it said.

“The key business risks for the group are the pressures of a highly competitive and changing retail environment combined with increased economic uncertainty.

“A number of geopolitical events have resulted in continuing supply chain disruption as well as energy, labour and food price increases, driving inflation and interest rates higher and resulting in weaker disposable income and lower consumer confidence.”

In January, Sky News reported that River Island had hired AlixPartners, the consulting firm, to undertake work on cost reductions and profit improvement.

AlixPartners’ role is now understood to have been superseded by that of PwC.

Retailers have complained bitterly about the impact of tax changes announced by Rachel Reeves, the chancellor, in last autumn’s Budget.

Since then, a cluster of well-known chains, including Lakeland and The Original Factory Shop, have been forced to seek new owners.

Poundland, the discount retail giant, is in the latter stages of an auction process, with Hilco Capital and Gordon Brothers remaining interested in acquiring it.

A spokesperson for River Island declined to comment.

The US economy saw a slowdown in hiring but no leap in unemployment last month as the impact of Donald Trump’s trade war continues to play out.

Official data, which strips out the effects of seasonal workers, showed 139,000 net new jobs were created during May.

Market analysts and economists had expected a figure of 130,000 – down on the 147,000 for April.

The unemployment rate remained at 4.2% and hourly pay rates rose.

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The figures were released as the health of the US economy continues to attract close scrutiny amid ongoing fears of a recession risk in the world’s largest economy due to the effects of the US president’s trade war.

Unlike most developed economies, such a downturn is not determined by two consecutive quarters of negative growth, but by a committee of respected economists.

It’s known as the Business Cycle Dating Committee.

It uses employment data, as well as official growth figures, to rule on the status of the economy.

The threat of tariffs, and early salvoes of, the Trump administration’s protectionist agenda were blamed for a sharp slowdown in growth over the first three months of the year.

Economists have found it hard to predict official data due to the on-off, and often chaotic, nature of tariff implementation.

As such, all official figures are keenly awaited for news of the trade war’s impact on the domestic economy.

Other data this week showed a record 20% plunge in US imports during April.

Next week sees the release of inflation figures – the best measure of whether import duty price increases are working their way through the supply chain and harming the spending power of businesses and consumers.

It’s a key piece of information for the US central bank.

It has paused interest rate cuts, to the fury of the president, over trade war uncertainty.

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A forecast by the Paris-based OECD this week highlighted the chance of consumer price inflation rising above 4% later in the year.

It currently stands at an annual rate of 2.3%.

Fears of a US recession and trade war uncertainty have combined most recently with increasing market concerns about the sustainability of US debt, given Mr Trump’s tax cut and spending plans.

US stock markets are largely flat on the year while the dollar index, which measures the greenback against six other major currencies, is down 9% this year and on course for its worst annual performance since 2017.

European stocks entered positive territory in a small nod to the employment data, while US futures showed a similar trend.

The dollar rose slightly.

The reaction was likely muted because the data was well within expectations and seen as positive.

Commenting on the figures Nicholas Hyett, investment manager at Wealth Club, said: “The US labour market has shrugged off the tariff uncertainty that rocked global stock and bond markets in April and May.

“While the Federal government has continued to shed a small number of jobs, the wider economy has more than made up the difference, with the US adding slightly more jobs than expected in May. Wage growth also came in higher than expected – suggesting the economy is in rude health.

“That will be taken as vindication by the Trump administration – which has been clear that the tariffs are aimed squarely at supporting Main Street rather than pleasing Wall Street.

“Less positive from the White House’s point of view is that a strong economy and rising wages gives the Federal Reserve less reason to cut interest rates – pushing yields a touch higher and making the fiscal splurge built into Trump’s “Big Beautiful Bill” that bit more expensive.

“With rate cuts looking less likely, Fed Chair Jay Powell can expect to remain firmly in the president’s firing line once the spat with Musk is over.”

Elon Musk says Donald Trump appears in files relating to the disgraced paedophile financier Jeffrey Epstein.

It’s the latest in a string of barbs between the men as they appear to have dramatically fallen out in a public spat.

In a post on X, the tech billionaire said: “@realDonaldTrump is in the Epstein files. That is the real reason they have not been made public.

“Mark this post for the future. The truth will come out.”

He gave no evidence for the claim. Meanwhile, White House press secretary Karoline Leavitt dismissed the comment.

In a statement, she said: “This is an unfortunate episode from Elon, who is unhappy with the One Big Beautiful Bill [a Republican tax and spending bill] because it does not include the policies he wanted.

“The president is focused on passing this historic piece of legislation and making our country great again.”

Epstein killed himself in his jail cell in August 2019 while awaiting trial on charges of sex trafficking minors.

Read more:
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In another post on Thursday, Musk, the owner of social media platform X, attacked Mr Trump’s tariffs, saying they “will cause a recession in the second half of this year.”

The Tesla boss shared a post calling for Mr Trump’s impeachment and asked whether it was “time to create a new political party in America that actually represents the 80% in the middle”.

Musk also said his company SpaceX will begin decommissioning its Dragon spacecraft “immediately” following Mr Trump’s threats to cancel government contracts with Musk’s businesses.

Dragon is the only US spacecraft available to deliver crew to and from the International Space Station.

The spat has already hit Tesla shares, which lost about $150bn (£111bn) in value, closing down 14.3% for the day.

It comes after the president said he was “disappointed” with Musk after the entrepreneur publicly criticised Mr Trump‘s signature tax bill.

The president suggested his former backer and adviser missed being in government and has “Trump derangement syndrome”.

He added: “I’m very disappointed in Elon. I’ve helped Elon a lot.”

In a Truth Social post, the US president said: “Elon was ‘wearing thin,’ I asked him to leave, I took away his EV mandate that forced everyone to buy electric cars that nobody else wanted (that he knew for months I was going to do!), and he just went crazy!”.

On Tuesday, the world’s richest man called the president’s tax and spending bill “outrageous” and a “disgusting abomination” – days after abruptly leaving his position spearheading the Department of Government Efficiency (DOGE).

The bill, which includes multi-trillion-dollar tax breaks, was passed by the House Republicans in May and has been described by the president as a “big, beautiful bill”. By contrast, Musk has called it the “big, ugly bill”.

Shortly after the president expressed his disappointment in Musk on Thursday, the SpaceX boss responded.

“False”, he wrote on his X platform.

“This bill was never shown to me even once and was passed in the dead of night so fast that almost no one in Congress could even read it!”

In another scathing post on X, Musk claimed responsibility for Donald Trump’s re-election success.

He wrote: “Without me, Trump would have lost the election, Dems would control the House and the Republicans would be 51-49 in the Senate.”

It came after Mr Trump told reporters the Tesla chief executive was unimpressed electric vehicle incentives were being debated in the Senate and could face being cut.

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Last Thursday, Musk revealed on X that his scheduled time as a “special government employee” was coming to an end.

Before the news broke, Musk’s father told Sky News his son was “not a very good politician”.

But speaking to Gillian Joseph on The World, Errol Musk insisted there was “no rift between Elon and Donald Trump”.