// Sir Philip Green reported to be nearing US CVA agreement after landlord objections
// Source says out-of-court negotiations to settle Vornado and Caruso’s challenges to Arcadia
Sir Philip Green is reported to be close to settling legal challenges to Arcadia Group’s dealings with its US stores, following its CVA in the UK.
It’s thought Green is now nearing out-of-court settlements to the challenges brought by two American landlords, Vornado and Caruso, according to reports by the Times.
After Arcadia’s company voluntary agreement in the UK was given the green light in June, Arcadia decided to push its US subsidiary into administration.
In papers filed in a New York bankruptcy court days after the UK CVA was agreed, a group of Topshop landlords include Vornado and Caruso accused Arcadia of “engaging in a convoluted scheme to deprive the…US landlords of their bargained-for contractual rights by manipulating and exploiting a private, little-used out-of-court process in the UK known as a company voluntary arrangement”.
The landlords argued that they were “frozen out” of the CVA process, and that they are affected by it because of the interconnected nature of guarantees within Arcadia and because it may result in reduced recoveries for US creditors.
At the time, Caruso pointed out that its two Topshop leases were guaranteed by the parent company, which is part of the CVA process.
It added that Arcadia USA had failed to disclose the existence of multi-debtor proceedings in its paperwork or at the hearing to consider an interim approval of the liquidation sales at the US stores.
Now, according to a source close to the talks cited by the Times, it’s thought Caruso and Vornado’s separate challenges to the CVA will be withdrawn after negotiations with Green.