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BHS secures loan to fund turnaround plan

BHS has secured a loan from London-based investment group Grovepoint against a small number of its stores.

The struggling department store chain was sold by Sir Philip Green to a group of financiers known as Retail Acquisitions, led by former racing car driver Dominic Chappell, for £1 in March.

A spokesman for BHS said the deal has given the chain a working capital of around £85m, which will be used to fund the three-year turnaround and modernisation plan.

The plan includes upgrading stores, introducing new branding across the online and offline portfolio with new windows, fixtures and fittings, as well as improving the distribution centre and launching a new website on a new platform.

“The funds will allow us to press forward with our turnaround plan because we although we are generating cash, it is not enough to accelerate the plan,” said the spokesman.

“We are up on last year and trading in line with expectations, and the start of the autumn season has been better than expected.”

Sir Philip Green wrote off £200m of loans from Arcadia to BHS in April, according to documents filed at Companies House. However, he continues to have financial exposure to the chain through a £40m loan secured against BHS’s leasehold property at the Cribbs Causeway shopping centre in Bristol.

BHS is set to unveil its new food concept later this week at its Watford store, with a new in-store cafe called The Lounge Coffee Shop and a move into convenience food retailing.


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