House of Fraser CVA delayed by landlords
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House of Fraser’s planned company voluntary agreement (CVA) has been delayed by landlords who have launched legal action, with representatives call the plans “unfairly prejudiced”.
New House of Fraser owners C.Banner, filed an announcement with the Hong Kong stock exchange yesterday (26 July) explaining that the company would need additional time to finalise details of the CVA.
It is expected that the company will provide shareholders with an update regarding the deal no later than 31 October, leaving House Of Fraser short of funds for a considerable amount of time.
In a statement last week landlord representatives Mark Fry of Begbies Traynor and Charlotte Coates of JLL, said: “We strongly believe it to be unjust for the existing shareholder in House of Fraser to receive £70m of value, the details of which were not communicated initially, whilst certain landlord creditors are shouldering the financial impact of the process.
“It is our view, and that of our legal counsel, that landlords have been disproportionately affected during this CVA process; not only compared to other creditors, but also to how they could have been treated if alternative routes to rescuing the business were fully explored.”
Hamley’s owner, C-Banner announced it was set to buy a 51% stake in House of Fraser subject to a CVA taking place.
