Sir Philip Green’s retail empire Arcadia has pledged to reduce the rent cuts proposed in its CVA in a bid to get landlords onside, Retail Week can reveal.
The retailer has unveiled plans to reduce the rent cuts it had sought from 70% to 50%, while properties it was previously seeking a 30% reduction on will now be in line for a 25% cut.
The shortfall that these reduced rents cuts will amount to will be plugged by funds provided by Lady Green, which will amount to £9.5m in the first year.
Arcadia has said all implicated landlords, including those who have already voted in favour of the CVA, these revised terms.
The fashion retail group is also understood to be doubling the length of the break clauses on affected properties from three months up to six.
The move comes as Green seeks to sweeten Arcadia’s CVA deal for landlords after the fashion group failed to win the required 75% support to pass its CVA proposal earlier this week.
Major landlords were split on Arcadia’s plan to shut 23 stores and slash rents on almost 200 others, which left the vote on a knife edge.
The verdict on the proposed CVA was postponed with the final decision now set for June 12.
Arcadia chief executive Ian Grabiner said: “Having already secured the support of our pensions trustees, trade creditors and a significant number of landlords, we hope these final revised terms will ensure the majority of landlords support the CVA at next week’s vote.
”Their support is vital for the long term sustainability of the group, our 18,000 employees and our extensive network of loyal suppliers.”