New Look landlords lose legal battle against retailer’s restructuring plan
New Look landlords have today lost their legal battle against the high street retailer’s restructuring plan.
The High Court ruled against the group of landlords that had challenged New Look’s company voluntary arrangement.
The retailer launched its second CVA within two years last September after its sales suffered during the coronavirus pandemic.
New Look’s proposal to switch to turnover-based rents was backed by the majority of creditors, but a group of disgruntled property owners launched a legal challenge against the restructuring plan.
Following the CVA vote, the high street chain was able to switch to turnover-based rents at 402 of its UK stores, aligning rent payments with future sales performance.
Read more: New Look to warn landlords it could collapse without further rent cuts
The remaining 68 stores were not to be charged rent, New Look said.
The approval of the terms of the company voluntary arrangement (CVA) also allowed New Look to access a £40m injection of new capital.
The firm has also secured a debt for equity swap, reducing senior debt from around £550m to £100m, and an extension of primary working capital facilities.
The CVA plan also includes enhanced landlord breaks to allow property owners to exit the lease if they can find a different tenant on better terms.