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Homebase landlords considering legal action over CVA

Homebase store angled 725 x500

A number of landlords likely to be affected by Homebase's CVA proposal are understood to be considering legal action.

Professional services companies Begbies Traynor and Hogan Lovells have been appointed by separate groups of landlords over Homebase's plans to offer them reduced rental payments of between 20-90%.

Aberdeen Standard Investments and M&G are two landlords looking to take action against the business, having hired Hogan Lovells to push back against the CVA proposal which would see them experience a sudden loss of income from the affected properties.

CVAs are increasingly being used to reduce overheads for ailing businesses and has led to property owners accusing retailers of using the agreements to force landlords to bail them out.

Last week, The Times revealed it had seen a document that stated 70% of Homebase stores are losing money.  

Alvarez & Marsal's head of restructuring, Richard Fleming, has said that the CVA process is a "vital lifeline" for Homebase, stating that it would secure the the long term future of the brand for the benefit of "all stakeholders". 

If creditors vote against the CVA, it is likely that Homebase will enter administration. The vote takes place on Friday 31st August.

Source : Insight DIY

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28 August 2018

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