American landlords have questioned why Arcadia Group’s debts to certain suppliers fluctuated at the time of the second vote on the group’s company voluntary arrangement, potentially lessening landlords’ power to block it.
US property giant Vornado has asked Sir Philip Green to explain why debts to 10 Topshop and Topman suppliers rose by £24m between June 7 and June 18, the Sunday Times has reported.
The rocketing value of an inter-company debt owned by Topshop Topman to the parent company, from £3.7m to £103.7m, over the same period has also been questioned.
This comes as part of a legal challenge filed against Topshop’s liquidation in America. Five landlords, led by Vornado, claim Arcadia Group “manipulated and gerrymandered” its CVA in the UK to affect the “complete forfeiture and deprivation” of their rights.
Under the terms of the seven CVAs approved by creditors, Arcadia will close all 11 Topshop and Topman stores in the US.
The group will also close 23 of its UK and Irish stores. Alongside the CVA, Arcadia plans to put two subsidiaries into administration, resulting in a further 25 UK store closures. Six Miss Selfridge stores and 19 Evans stores will also be affected in the UK.
The chief executive of the Pensions Regulator will also face questioning this week from a committee of MPs over its deal with Sir Philip Green as part of the CVA.
Charles Counsell will appear before politicians to answer queries on the extra £25m Green agreed to pump into Arcadia Group’s pension fund to gain the regulator’s support, City AM has reported.
Arcadia has declined to comment.