Speciality Retail Group (SRG), the group behind the Suits You menswear chain, has become the latest retailer to put forward a CVA proposal
By Jennifer Denby
In an attempt to cut costs and avoid collapse, Speciality Retail Group Ltd (SRG), the menswear retailer, which trades as the Suits You, Racing Green and Young's brands, has announced a company voluntary arrangement (CVA) proposal.
Commenting on the announcement, Richard Fleming, UK Head of Restructuring at KPMG, and proposed 'supervisor' of the CVA, said: “SRG is a successful brand in its designer outlet stores but has been unable to stave off the drop off in consumer demand in its high street stores. While the company has taken significant steps to address its problems, the business faces administration unless it can restructure its operations via a CVA.”
NO STORE CLOSURES
SRG, which runs 71 stores across the UK and employs approximately 300 people, will undergo no immediate store closures or redundancies, said KPMG.
“Unlike the JJB and Blacks CVAs where loss-making stores were closed and landlords of these stores were offered six months’ rent plus rates, SRG is not proposing to close any of its stores immediately. Landlords of the 42 loss-making stores will be offered 60 percent of the full rent for a period of 18 months. The stores will continue to trade during this period,” Fleming added.
Brian Green, restructuring partner at KPMG, and proposed 'supervisor' of the CVA, said: “In the coming weeks, we will be involved in meetings with the landlords to explain the proposal in more detail. For the CVA proposal to take effect, 75 percent of all creditors must agree to the terms. If voted through, the CVA will last for around 18 months."
The remaining creditors have not been asked to compromise financially but the landlords of the 29 profitable stores have been asked to move to a monthly payment schedule for 18 months.
Source: http://rd.kpmg.co.uk
Edited by Chris Farnell