// KPMG taps bondholders for £12m in funding for Intu
// Without it, it may be hard for Intu to continue operating some of its shopping centres during an administration process
Intu’s administrator-in-waiting is reportedly seeking a £12 million cash injection from bondholders as part of a potential insolvency process.
According to Sky News, KPMG has asked bondholders in the vehicles which directly own Intu’s Metrocentre in Gateshead and Trafford Centre in Manchester for the additional funding.
Sky News reported it might be hard for Intu to continue operating some of its shopping centres during an administration process if it did not gain that cash injection.
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Intu and KPMG have not commented.
The news comes after it emerged last week that Intu chief executive Matthew Roberts had requested an 18-month standstill that would grant the retail property giant relief from covenant tests and payments on debt facility maturities.
Without lenders’ agreement, a waiver that expires on June 26 would likely result in the company’s administration.
Intu has about £4.5 billion of debt, but a market capitalisation – at the time of writing – of just £97 million.
It is also one of the London stock market’s worst performers, with its shares down by more than 90 per cent over the last year.
The company employs nearly 3000 people directly – and a further 102,000 people working in its 17 UK shopping centres.
Another 30,000 people work in Intu’s broader supply chain.
Last week, Intu also published figures showing that a standstill agreement would leave it with enough cash to continue operating.
The coronavirus pandemic has resulted in a number of major retailers refusing to pay their landlords.
There are fears the next rent cycle, due at the end of June, could spell more bad news for retail landlords, especially the likes of Intu, Hammerson, British Land and Landsec.
Earlier this year, Intu tried to raise £1.5 billion from an emergency equity-raising, but all hopes collapsed when financial markets were impacted by the coronavirus crisis.