Hotter launches CVA proposal
Hotter launches CVA proposal
Commenting on the Company Voluntary Arrangement (CVA) proposal announced by Beaconsfield Footwear Limited, Will Wright, partner at KPMG and proposed supervisor of the CVA said.
“Like so many other companies across the retail and manufacturing sectors, Hotter has been battling against a number of headwinds in recent years including fragile consumer confidence, rising costs, business rate pressures and the increasing shift to online shopping.
“The impact of the coronavirus pandemic on store footfall has further exacerbated these pressures, and has led the directors of the business to conclude that the company has no sustainable future without bringing forward its plan to reduce its bricks and mortar retail operation in order to focus on its core online and direct order operations.
“If approved, the CVA will therefore provide the business with a stable platform from which it can continue to trade over the medium to long-term.”
The CVA proposal divides the store portfolio into two categories as follows:
- A total of 23 sites, comprising 17 stores and 6 garden centre outlets will be retained under the CVA proposal, with rents paid in full on a monthly basis;
- A total of 51 loss-making stores are proposed to close under the terms of the CVA with liabilities in relation to these leases to be compromised in return for an estimated dividend of 28 pence in the £.
If the CVA is approved, Electra Private Equity plc, the Company’s ultimate parent, will provide a payment of £2m which will be used to facilitate the establishment of a Compromised Landlords’ Payment Fund.
Hotter needs to secure at least 75% creditor approval by value for the CVA for it to proceed. Detailed proposal documents will be made available to creditors via a dedicated website today. The creditors will vote on the CVA on 28 July 2020. Consultations have already taken place with key creditors and KPMG will spend the coming weeks in further talks with key creditors to ensure they understand the full detail of the proposal.
For further information, please contact:
Katy Broomhead, Senior PR Manager
Tel: 0161 264 4623 / 07824 537963
KPMG Press Office: 020 7694 8773
KPMG LLP, a UK limited liability partnership, operates from 21 offices across the UK with approximately 17,600 partners and staff. The UK firm recorded a revenue of £2.40 billion in the year ended 30 September 2019. KPMG is a global network of professional firms providing Audit, Tax, Legal and Advisory services. It operates in 154 countries and has 200,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.
© 2021 KPMG LLP a UK limited liability partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
For more detail about the structure of the KPMG global organisation please visit https://home.kpmg/governance.