House of Fraser’s key lenders are demanding proof that its Chinese shareholders will provide the £70m capital pledged last month.
The beleaguered department store’s senior lenders, HSBC and Industrial & Commercial Bank of China (ICBC), and their advisers at EY, have railed against the lack of clarity surrounding the retailer’s new financing arrangements.
According to Sky News, both banks are demanding evidence that the £70m of fresh capital pledged by Hamleys owner C.banner will be provided to the ailing chain, which will seek landlord support for its controversial CVA plan next week.
This pledged transaction has been rumbling on and was set to be issued by the end of last month.
However, the department store chain has since said the deal may not be finalised until July 26 “as additional time is required for the company and various professional advisers to finalise the contents”.
Talks with the retailer’s key lenders have been ongoing this week and are set to continue through the weekend as the department store chain approaches its crunch CVA vote.
Several sources told Sky News they were not confident an agreement with lenders would be reached in order for its CVA proposal to go ahead, although one souce close to the situation was adamant that discussions were “on track”.
Without support from lenders for its CVA vote, House of Fraser would be at risk of tumbling into administration.