Follow us

Menu
PARTNER WITH USFREE NEWSLETTER
VISIT TheIndustry.beauty

Arcadia appoints property adviser ahead of possible CVA as Ashley rules out interest

Lauretta Roberts
22 March 2019

Sir Philip Green's property group Arcadia has appointed a property adviser ahead of a potential CVA as Sports Direct boss Mike Ashley squashed rumours of a potential bid saying he is not prepared to take on the pension deficit.

Property Week reports that GCW has been appointed to advise Arcadia on its 500-plus leased store estate following reports that the group was considering a CVA (Company Voluntary Arrangement).

Under a CVA, retailers can seek to have rents reduced and to terminate lease contracts before they are due to end in a bid to cut costs and safeguard the future of a company. Other measures can include agreeing to pay creditors back an agreed proportion of debts over a period of time to give a business breathing space.

It is a controversial process at the best of times and requires delicate negotiations with landlords and creditors, who must vote to approve a deal. Arcadia's is expected to be more controversial than most given its owner is a multi-billionaire and the company is believed to be profitable, although its pre-tax profits of £53.5m posted to April 2017 are likely to have been considerably reduced.

The appointment of GCW comes after two major major property advisers CBRE and JLL reportedly declined to act on the company's behalf.

Meanwhile Sports Direct boss Mike Ashley has ruled out making a bid for Arcadia saying its pension deficit is a deal-breaker. Ashley told The Times: “I am not getting involved with that pension deficit in Arcadia for reputational reasons. It is not for me. I don’t know where the story is coming from — for all I know Philip is putting it out there that I am going to buy it — but I am not interested.”

It had been rumoured that Ashley might either make a bid directly or in partnership with Leonard Green & Partners, a US private equity house that already owns 25% of Topshop.

Free NewsletterVISIT TheIndustry.beauty
cross