Carpetright secures 92% of £60m CVA funds

Embattled retailer Carpetright has managed to secure the majority of the £60m funding it needs to fund its company voluntary agreement (CVA) and restructuring costs.

In April, the company proposed an issue of 232.5 million new shares through a placing and an open offer priced at 28p per share.

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The open offer closed on Tuesday 5 June and 92.1% of the qualifying shareholders subscribed.

The placing and open offer will be confirmed in a general meeting this afternoon. Following that, the remaining shares will be taken up.

It is understood that around £6m will be used to cover the costs of the CVA which was approved in April.

Another £12.5m will be for the repayment of the principal amount of the short term unsecured loan from Meditor which Carpetright entered into on 21 March 2018. Around £33m will also be used to fund the company’s capital expenditure.

The CVA followed a profit warning issued by Carpetright and will see the closure of 92 of the chain’s stores and affect 300 jobs. At the time, Carpetright said it “simply wasn’t sustainable” to keep the outlets open at a time where more people were shopping online.

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