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High Street

Debenhams engages Deloitte for legal challenge against CVA

Debenhams has engaged ‘Big Four’ accounting and audit firm Deloitte in preparation to fight a legal challenge to its restructuring plan.

In May, the retailer secured the backing from creditors to go ahead with a company voluntary arrangement (CVA), which earmarked 50 sites for closure and approved rent reductions at more than 100.

Property group Combined Property Control Group (CPG), landlord for six Debenhams stores, has launched a legal challenge to the CVA. If the group wins the case, which begins at London’s High Court today (2 September), the company could enter administration.

A statement from Debenhams, said: “We remain extremely confident this challenge is without merit and expect it to fail. In the meantime, we are progressing with our restructuring, which was approved by the vast majority of creditors, including over 80 per cent of landlords.”

This comes after real estate company M and G Real Estate withdrew its court challenge against Debenhams in July, following “positive, constructive discussions” which resolved the concerns.

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