A group of US landlords have reportedly filed a legal challenge against Topshop’s liquidation in America, in a bid to recoup some of their losses, which they claim to be in excess of £100m.
Five landlords, led by Vornado, claim Arcadia Group “manipulated and gerrymandered” its company voluntary arrangement (CVA) in the UK to affect the “complete forfeiture and deprivation” of their rights, the Sunday Times reported.
Under the terms of the seven CVAs approved by creditors last week, Arcadia will close all 11 Topshop/Topman stores in the US.
It 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.
Sir Philip Green still intends to trade through Topshop’s website and concessions in Nordstrom in America. However, landords are demanding the court holds Arcadia’s American assets and proceeds from the liquidation in “escrow to stop the company funnelling cash back to the UK”.
The first American Topshop opened in Manhattan in 2009, eventually expanding to 11 stores.
Arcadia and Vornado have been contacted for comment. Arcadia’s appointed administrator Deloitte declined to comment.