Deal could generate £10m
Austin Reed plans a£5.9 million sale and leaseback of the group's warehouse and office facilities in Thirsk, North Yorkshire. A further£4.73 million could be raised from the sale if certain post-sale criteria are met.
The clothing retailer exchanged contracts with property developer Old House Group today. Completion of the deal is subject to approval from shareholders.
In recent years the board at Austin Reed has implemented various strategies in an attempt to improve the group's financial performance.
The proceeds from the sale will be used primarily to reduce the company's debts. A spokeswoman said: 'Holding the property is not necessarily the best use of that asset - it's all about maximising the value from the group's property portfolio'.
The group will continue to operate out of the warehouse and offices on the site.
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