House of Fraser seals deal with landlords
House of Fraser has said that an agreement with a group of landlords has removed an obstacle to securing new investment.
The department store chain had faced a legal challenge from the landlords who argued the group’s CVA was unfair. The threat to the CVA saw Hamleys owner C.banner pull out of a deal to buy a majority stake and invest £70m.
The chain said it was ‘focused on concluding discussions with interested investors’ and the out-of-court settlement had removed ‘any risk to those discussions’.
Begbies Traynor and JLL, who advised the landlords group said they were pleased with the settlement. ‘The retail CVA process in the UK has become increasingly misused and prejudiced against landlords and needs correcting. CVAs were designed as a means to rescue a business, not simply a tool to shed undesirable leases for the benefit of equity shareholders.’