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Arcadia caves in to landlords on rents

Arcadia Group has revised the rent reductions set out in its company voluntary arrangement (CVA) proposals, in a bid to win landlord support. 

It comes after the group postponed its CVA vote until 12 June to “conduct further dialogue with a few landlords” with a view to securing a final decision in favour of its proposals. 

Previously, the group requested a reduction in rental costs of between 30% and 70% across 194 of its 566 UK and Irish stores over a three-year period.

This has been revised to 25% to 50% for all affected landlords across the seven CVAs.

Arcadia said landlords who have already voted to approve the CVAs “will also benefit from these improved terms”.

The cost of this amendment will be entirely funded by the group’s shareholder, Lady Green. In the first year, the initial cost is expected to be around £9.5m.

Ian Grabiner, CEO of Arcadia, said: “Having already secured the support of our pensions trustees, trade creditors and a significant number of landlords, we hope these final revised terms will ensure the majority of landlords support the CVA at next week’s vote. Their support is vital for the long-term sustainability of the group, our 18,000 employees and our extensive network of loyal suppliers.”

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