Blacks reveals store exit CVA plan
03 November 2009 10:12
Embattled outdoor retailer Blacks Leisure has revealed some of the details of its proposed company voluntary arrangement (CVA), which includes a plan to exit 101 unoccupied stores. The release of this financial burden is hoped will enable the group to save 291 trading stores and the jobs of 4,300 employees.
Under the terms of the CVA Blacks will request that the landlords of the 101 affected stores will agree a compromise deal enabling the retailer's exit from tenancy agreements while offering the landlords £7.25 million. This figure represents something in the region of six months' rent for each store.
KPMG UK head of restructuring Richard Fleming said: "We believe the proposed CVA offers a fair balance between the operational needs of Blacks and the landlords' rights under the tenancy agreements. The total compensation being offered to the landlords is £7.25m, which equates to approximately six months' rent each. In addition and importantly, given the size of the potential liability, the group will continue to pay rates until the leases are surrendered or forfeited in consultation with landlords."
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