New Original Factory Shop owner eyes major rent cuts as part of CVA
Modella Capital is now preparing to unveil a rent cuts package for its store landlords as part of plans for a CVA, which were first reported by Sky last month
The Original Factory Shop (TOFS) landlords could face a package of major rent cuts as its new owner aims to finalise plans for a CVA for the group, with potential store closure also featuring as part of the move. According to Sky News, Modella Capital is now preparing to unveil a rent cuts package for its store landlords as part of plans for a CVA, which were first reported by Sky last month.
Sky reported that “dozens” of TOFS stores could close under the CVA, while a major distribution centre could also feature in the proposals, amid demands for two-year rent-free periods, according to sources.
Any “landlord-led” CVA which triggered store closures could lead to job losses among TOFS’ workforce, which was around 1,800 employees at the time of Modella’s takeover.
Sources also told Sky the CVA could be unveiled within days, though concrete plans that include the exact date for the CVA’s launch have not yet been disclosed.
Founded in 1969, The Original Factory Shop sells brands such as L’Oreal, Adidas and Black and Decker.
Private equity firm Duke Street acquired the retailer in 2007, and in present day, it trades from about 180 stores.
Duke Street had previously provided over £10m to support the business during the Covid-19 pandemic, and had attempted to sell it before.
Modella Capital has been contacted for comment.
