Stylo, the footwear group which owns Barratts and Priceless, is poised to go into administration after failing to secure enough support for its Company Voluntary Agreement (CVA) from its creditors.
Deloitte will be appointed as administrators of Stylo.
Daniel Butters, partner and joint administrator at Deloitte said: “Following the meeting and vote yesterday we confirm that creditors and landlords have not accepted the CVA proposals. As a consequence we will now seek to achieve a sale as a going concern to preserve as many jobs as possible. We are in focused talks with interested parties in an effort to deliver a swift solution.”
Sources in the footwear industry expect the Ziff family, who own the majority of Stylo, will make a play to buy the business back. It is unclear whether other parties are also circling the Barratts and Priceless chains.
A significant number of stores are expected to close as a result of the adminstration.
The CVA is believed to have failed because some of Stylo’s landlords are said to have voted against Stylo’s proposals, which would have seen them paid 3% of shop turnover for three months beginning in June. The payment would have increased to 7% for the remaining 11 month period of the CVA.
Landlords are thought to have voted against the CVA because of fear that an approval would pave the way for other retailers to pursue similar deals.
However suppliers to the Barratts and Priceless chains were thought to have been broadly supportive of the CVA. They were due to be paid outstanding monies in full over the 14 month period from June. Stylo’s suppliers were owed around £10 million collectively.