Sir Philip Green’s Arcadia group is looking to raise £50m to help see the fashion empire through the COVID-19 crisis.
According to Sky News, the group, whose brands include Topshop, Dorothy Perkins, Burton, Evans, Wallis and Miss Selfridge, is looking into borrowing £50m against its distribution centre in Daventry, Northamptonshire.
All 550 of the group’s stores are closed during the crisis in line with the Government’s mandatory shut down of non-essential retail and e-commerce is still operational, albeit at a reduced capacity.
Arcadia has furloughed the majority of its 16,500 workforce. All store staff and a number of head office staff, totalling 14,500, have been placed on the Government-backed job retention scheme. Senior managers have taken pay-cuts, while CEO Ian Grabiner has waived his salary and all benefits.
It is also understood that the company is also talking to landlords and is looking to close a significant number of its stores permanently. Meanwhile it has also paused payments into its pension scheme.
The Daventry distribution centre was opened last year and is central to Topshop’s logistics operations. It is owned by Sir Philip’s wife Lady Tina, who is have agreed as part of the group’s restructuring last year to subordinate her debt position, in order to allow Arcadia to borrow against it.
Arcadia had been operating under a CVA since last June. At that time it agreed the closure of 23 stores and a further 25 under a separate insolvency procedure.