The Dublin-based retailer has been quick to distance itself from its troubled namesake after Mothercare UK, which has already nearly halved the number of stores it has in the past five years, said that its financial outlook was "perilous" and that it will be closing another 50 stores in Britain, and putting 800 jobs at risk.
Mothercare has announced as part of a Company Voluntary Agreement (CVA) it will shut 50 of its 137 stores with around 800 jobs axed. Its shares have lost 83 percent of their value over the previous year.
The company also said it would reappoint Mark Newton-Jones, the chief executive who left in April following a profit warning.
Putting media speculations to rest, Mothercare has confirmed measures to refinance its business and restructuring of its United Kingdom store portfolio.
The struggling retailer has also agreed a rent cut with landlords for 21 of its stores.
The shake-up aimed at restoring the fortunes of the chain are likely to result in hundreds of job losses.
The company further added that the United Kingdom restructuring plan will involve an accelerated reduction of the United Kingdom store estate to reduce losses and rent liabilities and will be effected through the CVA Proposals.
'These comprehensive measures provide a renewed and stable financial structure for the business and will drive a step change in Mothercare's transformation.
In addition to the proposed equity issue Mothercare has also secured revised committed debt facilities of 67.5 million pounds, 8 million pounds of new shareholder loans and a new facility of up to 10 million pounds from a trade partner. Past year it recorded a small operating profit after savings made from the closures of its Blackrock and Jervis Street stores in Dublin and the Cruises Street shop in Limerick.
Mothercare, which has been trading since 1961, said it was facing a "perilous financial condition" and had identified a large number of loss-making stores.
Creditor meetings to vote on the CVA proposals are expected to be held on June 1, with the process expected to complete in July.