Moss Bros calls on KPMG to help with restructuring plans
Menswear retailer Moss Bros is heading towards a restructuring that could result in the closure of some of its stores and rent reductions on others.
Moss Bros has reportedly called in KPMG, according to the Sunday Times, which could pave the way for a company voluntary arrangement (CVA).
A CVA allows companies to settle debts by paying creditors over a fixed period, and it could see the closure of some of Moss Bros’ 125 UK stores and rent reductions on others.
Talks with landlords over switching to rents linked to turnover have reportedly not been agreed.
Retailer New Look asked landlords last week launched a CVA, which involves resetting 402 stores to turnover rent to align rent payments with future performance.
The turnover percentage will be set at up to 12 per cent. Under the proposals New Look will not pay rent on its remaining 68 stores.
Earlier this year Brigadier Acquisition Company unsuccessfully tried to pull out of its £22m take-private deal for Moss Bros less than two weeks before all non-essential shops were ordered to close.
Brigadier, which owns Crew Clothing, sought a ruling from the Takeover Panel to cancel its offer the following month.
The coronavirus crisis has put pressure on commercial property companies to link a tenant’s rent to their turnover. London-listed Capco has offered variable leases until the end of the year in a bid to help cash-strapped tenants.
But the crisis has also triggered some property firms to resort to county court claims, exempt from a moratorium on landlord enforcement action due to end next month, to force tenants to pay the rent they have not paid.
Debenhams’ administrators are reportedly mulling a legal challenge to absolve them of rent payments, while LondonMetric is preparing a challenge against Frasers Group regarding unpaid rent at an Evans Cycles store.
Moss Bros and KPMG did not respond to requests for comment.