House of Fraser denies rumours of CVA showdown
House of Fraser has insisted its restructuring plan is "on track" despite reports suggesting its landlords could block the plans.
The retailer is expected to close a swathe of its stores under a company voluntary arrangement (CVA), the same mechanism used by New Look and Mothercare among others.
But some creditors are understood to be plotting opposition to the CVA. This comes after House of Fraser was criticised by a landlord group for not following customary procedure of consulting creditors before announcing the plan.
Yesterday afternoon House of Fraser issued a statement responding to what it called "inaccurate and unhelpful media speculation".
It said it was in close dialogue with its lending banks "who are supportive of the company’s plans" and that its planned sale of a majority stake to Hamleys owner C.Banner was progressing as planned.
C.Banner – which has made the completion of the CVA a condition of its acquisition – signed irrevocable undertakings approving all elements of the transaction yesterday. It has also entered a subscription agreement to sell shares in order to fund the deal.
House of Fraser Chairman Frank Slevin said: “We are on track with our plans to enter the proposed CVA agreement. The funding news from C.banner is another important milestone in this complex process.”