In a classic case of once bitten twice shy, a majority of Arcadia landlords have rejected the CVA proposals put forward by Sir Philip Green’s retail group. A further meeting will now take place next week as the landlords are insisting on much better terms from the retailer than have been put forward. It had been suggested that the group would enter administration if the CVA was not been voted through on 5th June, however it seems that the landlords were adamant that they would not bear the brunt of the problems which the retail group faced due to its lack of investment in its business. Behind the landlords, there are numerous suppliers who face an uncertain future if the business enters administration.
There is mounting concern among landlords that the CVA process has become a weapon for faltering retailers in place of securing investment from the sometimes wealthy owners of retail chains. In this particular case, there is little sympathy for the owners given that many of the landlords and suppliers are still left with unoccupied stores from the BHS collapse following its ill-considered “sale”.
One market watcher quipped: “As we know for certain in this case, significant personal wealth has been derived by stripping out the previous profits of the business and with the payment of UK taxes avoided. That the wealth has been flaunted to such a degree as to be an utter disgrace to those employed by the business, as in this case, why should anyone other than the beneficiaries of those massive sums be expected to roll over and let them get away with it. In my book, the Greens have more than enough funds at their disposal to sort this out themselves, just as they could have sorted out the mess they made of BHS. They should fully cover all of the pension deficit, and then sell off or ethically close the business that enriched them in the first place.”
Frank Field MP who is chairman of the Work and Pensions Select Committee has stated that his department will ‘use this time to look even more carefully at the adequacy of the pensions deal’.
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