Shopping centre operator Intu has confirmed the appointment of administrators after failed crunch talks with its lenders.
The owner of sites such as the Trafford Centre in Manchester and Lakeside in Essex said it has applied to appoint administrators from KPMG, after warning earlier today that it was on the verge of collapse.
The confirmation came minutes after the London Stock Exchange suspended shares in the listed firm.
However, the company said its shopping centres would continue to trade for the time being despite its insolvency.
Intu had been in a desperate scramble to agree a “standstill” on its current loan agreements. Earlier today the group said it was likely to appoint administrators, as it remained unable to agree the terms of such a deal with its creditors.
In a statement, the group, which had until midnight on Friday to reach a deal, said “insufficient alignment and agreement has been achieved”.
Earlier this week, Intu said it put the administrators from KPMG on stand-by as it looked to secure a deal ahead of the midnight deadline on its current loan covenants.
The group has struggled under a £4.5 billion debt burden for the past year, but has been hammered by significantly lower rent payments from retail tenants since the coronavirus outbreak.
The quarterly rent day for Q2 fell this week and, according to Re-Leased, landlords collected just 13.8% of rents due from retailers on the day with more expected to be recovered in the coming weeks.
Intu employs about 3,000 staff across the UK, while a further 102,000 work for the shops within its shopping centres.
It warned on Tuesday that its malls may be forced to shut if it was unable to secure the standstill agreement.