// Crunch board meeting to debate Topshop owner’s rescue plan
// Directors will examine proposals for a restructuringm either in a CVA or sales process
Arcadia Group board members are slated to hold a crunch meeting tomorrow to debate restructuring proposals in order to secure the longterm future of the retail empire.
According to Sky News, the directors of Sir Philip Green’s company will meet to discuss the status of a proposed CVA, an insolvency procedure that would involve scores of store closures in Arcadia’s UK estate as well as rent reductions.
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A source speaking to Sky News said tomorrow’s board meeting would involve a decision on whether to proceed with or cancel the CVA.
A CVA would only go ahead if board directors were confident it would have the approval from at least 75 per cent of landlords, pension trustees and other creditors.
Should that be rejected, then board is expected to discuss a sale process for Arcadia, which could be launched within a matter of weeks, according to Sky News.
Tomorrow’s board meeting will be chaired by Jamie Drummond Smith, a corporate restructuring veteran who was only appointed to Arcadia’s board this month.
The news comes after Arcadia Group was guaranteed support from HSBC for bank security over deposits worth millions.
The deal extends existing terms with HSBC, and will see the bank act as guarantor in relation to letters of credit to suppliers, according to This is Money.
Green’s company has also proposed to halve the annual contributions it makes to its pensions scheme, from the £50 million down to £25 million.
According to The Sunday Times, The Pensions Regulator had reportedly “pushed back hard” on Green’s attempts to lower contributions due to how he handled the BHS pension scandal.
In 2017, Green was forced to plug up to £363 million to the pension scheme of thousands of former BHS workers following months of discussions and controversy.
Arcadia had owned BHS for 15 years. It collapsed in 2016 under the ownership of Dominic Chappell, who had bought the chain from Green for £1 the year prior.
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