Sir Philip Green offers landlords cash to save Arcadia rescue plan
Sir Philip Green has offered landlords £10m a year of his family’s cash to offset the impact of rent cuts in a bid to secure their backing to rescue his retail empire.
Landlords had been asked to slash rental costs by 30 per cent to 70 per cent across 194 of Arcadia’s 566 UK and Ireland branches. Arcadia has now lowered the request to between 25 per cent and 50 per cent.
Read more: Intu set to vote against Arcadia CVA
The Green family rather than Arcadia will reportedly cover the difference at a cost of around £9.5m.
Arcadia postponed a decision on its restructuring plans earlier this week after failing to secure enough support for its company voluntary arrangement (CVA).
“Having already secured the support of our pensions trustees, trade creditors and a significant number of landlords, we hope these final revised terms will ensure the majority of landlords support the CVA at next week’s vote,” said Ian Grabiner, chief executive of Arcadia.
“Their support is vital for the long term sustainability of the group, our 18,000 employees and our extensive network of loyal suppliers”.
Intu, Aviva and M&G were among the major creditors understood to have voted against some of the proposals. However, British Land and Hammerson were said to have voted in favour of them.
Landlords that approved the initial CVA terms will also receive the rent cut reduction.
Read more: Sir Philip Green must stump up extra £50m to save Arcadia
After the vote closed on Wednesday Arcadia released an announcement saying it had decided to “adjourn today’s creditors’ meeting in order to conduct further dialogue with a few landlords with a view to securing a final decision on the seven CVAs.”
A total of 18,000 jobs and hundreds of high street stores are at risk if the Topshop owner is unable to achieve 75 per cent backing for its proposals in the vote on Wednesday.