The future of footwear group Stylo, which owns the Barratts and Priceless chains, will be decided today when creditors vote on its proposed Company Voluntary Arrangement.
Suppliers and landlords to the group are due to vote on whether to support Stylo’s CVA proposals at lunchtime today.
Under the proposals, suppliers would be paid outstanding monies in full over a 14 months period beginning in June. Landlords would be paid 3% of shop turnover for three months beginning in June 2009. This will rise to 7% of turnover for the remaining 11 months.
If creditors vote against the proposals the Stylo group itself will be forced into administration. Its Barratts and Priceless chains have already been placed into administration. This was done as a protectionist measure while the outcome of the CVA was decided.
Suppliers have told Drapers they are generally supportive of the CVA, saying they need more footwear specialists to survive the recession. However reports suggest landlords may vote against the proposals for fear that a vote otherwise would open the flood gates for many more struggling retailers to pursue a similar CVA route. This could leave landlords massively exposed.
However, if the proposal is voted through by creditors, Barratts and Priceless will come out of administration after a 28 day cooling off period and Stylo chairman and chief executive Michael Ziff will dramatically reshape the chains, shedding around 200 stores.
The CVA is being handled by Deloitte. However it is unclear whether the result will be made public later today or early tomorrow morning. Drapersonline.com will bring you the outcome as soon as it is available. Sign up for our free email newsletters on our homepage to ensure you are the first to hear about Stylo’s future.