- BHS secures fresh £10m loan to invest in fledgling food business
- Department store group’s food proposition launched in Watford last year
- Comes months after owner Retail Acquisitions secured £65m loan from Grovepoint Capital
BHS owner Retail Acquisitions has secured a loan from an American restructuring company in a bid to grow its food business.
Retail Acquisitions has agreed to borrow around £10m from a subsidiary of Gordon Brothers, the company that attempted to save Blockbuster from going bust, according to reports.
The cash injection will be used to roll out the BHS food business, which has been performing above expectations, The Times reported.
Back in September, the department store group unveiled a new-look store and logo in Watford, representing some of its plans for the future, particularly in food.
BHS enhanced its fledgling food offer by adding more SKUs to its range and launched a ‘2 Dine for £10’ meal deal – similar to the initiative already used by Marks & Spencer.
BHS boss Darren Topp said at the time that its food offer would be rolled out to 20 stores.
The department store group’s food proposition was piloted in 2014, before Sir Phillip Green sold the business to Retail Acquisitions for £1 last March.
BHS’s latest loan comes five months after it secured a £65m loan from investment group Grovepoint Capital to fund its turnaround plan.
It is understood that the loan was used to accelerate the retailer’s transformation, including the introduction of its food offer, rather than to meet rental bills.
BHS’s most recent financial figures revealed a loss of £85m for the year ending August 30, 2014.
Retail Acquisitions has hired KPMG to help overhaul the embattled retailer and draw up options to reduce its 170-store estate.
As revealed by Retail Week, BHS has already agreed a deal to lease its Oxford Street flagship to Polish retail giant Lubianiec Piechocki i Partnerzy (LPP).
LPP, which operates 1,574 shops in 17 markets, has signed “a preliminary lease of retail space” to bring its Reserved fashion fascia to the UK.