KPMG floats Blacks Leisure CVA plan

KPMG has put forward a Company Voluntary Arrangement plan to the landlords of
Blacks Leisure Group, the troubled high street retailer.

The firm is brokering the deal for the company which would see Blacks, which
runs approximately 392 stores across the UK and Ireland is asking 101 landlords
of unoccupied outlets to take a collective £7.25m pay off, equivalent to six
months rent.

The move would see the troubled company, which trades primarily as Blacks and
Millets, safeguard the remaining 291 outlets and the jobs of more than 4,300

For the CVA proposal to take effect, 75% of the creditors will need to agree
to the terms.

Richard Fleming, UK Head of Restructuring at KPMG, and proposed ‘supervisor’
of the CVA, said: “The proposed CVA gives Blacks the opportunity to preserve 291
trading stores and around 4,300 jobs.

“We believe the proposed CVA offers a fair balance between the operational
needs of Blacks and the landlords’ rights under the tenancy agreements.

“The total compensation being offered to the landlords is £7.25m, which
equates to approximately 6 months rent each.”

In addition and importantly, given the size of the potential liability, the
group will continue to pay rates until the leases are surrendered or forfeited
in consultation with landlords.”

The firm said it will be involved in meetings with the landlords to explain
the proposal in more detail during the coming weeks.

If endorsed, the CVA will last for around 9 months, the firm added.

Related reading