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Monsoon CVA faces legal battle

Shopping centre owner British Land has filed a legal challenge against Monsoon Accessorize’s company voluntary arrangement (CVA).

The property firm, which owns shopping centres Meadowhall in Sheffield and Drake Circus in Plymouth, among others, owns five units occupied by Monsoon Accessorize. 

It voted against the company’s CVA in July, which was backed by over 90% of creditors, and is understood to have felt it had little choice but to launch the legal bid last month. 

The CVA document, seen by Drapers, proposes rent reductions of between 25% and 65% across 135 out of a total 258 Monsoon and Accessorize stores.

No immediate store closures are planned, but the retailer is seeking to exit at least seven Monsoon stores.

Landlords have been offered up to £10m as part of a profit-sharing scheme if, following a successful CVA, Monsoon Accessorize trades profitably and above forecast.

The CVA proposal outlines an expected EBITDA loss of £3m across the businesses for the 2018/19 financial year, and a fall in revenue of 3.2% to £358m.

Monsoon’s CEO, Paul Allen, decided to leave the business in August after six years. It is understood he will not be replaced. 

 

 

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