// Arcadia reportedly looking to secure £30m loan, according to Sky News
// The Sunday Times cites sources reporting Arcadia directors could be planning “trading administration” for the group
// Arcadia says “it is not true that administrators are about to be appointed”
Sir Philip Green’s Arcadia Group is said to be sounding out lenders in order to borrow around £30 million for its retail businesses, according to Sky News.
The Topshop, Topman and Dorothy Perkins owner is believed to have approached several potential lenders regarding borrowing funds to help the business amid a second national lockdown for England.
A source cited by Sky News said talks with a number of parties are understood to be ongoing, and that the parties could be close to an agreement to secure the money.
READ MORE: Burton head office up for sale as Sir Philip Green restructures Arcadia
The talks come weeks after The Sunday Times reported Green had put the former London headquarters for clothing brand Burton up for sale.
Green appointed BNP Paribas to help him sell Corinthian House, the five-story office on Tottenham Court Road with an asking price of £80 million.
Arcadia’s pension fund took security over the building last year as part of a deal to win the support of the Pension Protection Fund for a restructuring.
At its last valuation in 2018, Arcadia had a pension deficit of £537 million, or £727 million on a “buyout” basis.
Last year, Green’s wife Tina agreed to fund £100 million, and Arcadia pledged to contribute £75 million over three years to alleviate the debt.
The pension trustees were granted security over £210 million of assets.
After the first lockdown in March, Arcadia furloughed 14,500 of its 16,000 staff and is making a fifth of its 2500 head office staff redundant.
Since the start of the pandemic, Arcadia paused the payments it makes to its pension scheme each month, but these have since resumed.
Sources cited by The Sunday Times today said the retail giant is poised to enter a “trading administration” that would allow Arcadia’s directors to continue running the business while they attempted to sell its brands.
The accountancy firm Deloitte is said to be working with Arcadia to develop a plan to break off a number of its brands from the retailer’s group, according to The Sunday Times.
“It is not true that administrators are about to be appointed,” an Arcadia spokesperson told Retail Gazette on Sunday.
“Clearly, the second UK lockdown presents a further challenge for all retailers and we are taking all appropriate steps to protect our employees and other stakeholders from its consequences.
“All our stores in Wales, Scotland and Northern Ireland have now reopened, and we are continuing to trade online through our own channels as well as through those of our partners.”
If Arcadia were to fall into administration, the group’s pension scheme would enter a Pension Protection Fund assessment period.
This would last between 18 and 24 months, unless Arcadia took back responsibility for it.
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