- Angela Gonzalez-Rodriguez |
New York – Monsoon and Accessorize have received a lifeline from its landlords after creditors backed plans to reduce rents on 135 stores at a meeting earlier this week. The fashion chains proposed a Company Voluntary Arrangement (CVA) in late May to help its ailing finances.
In a corporate release issued on Wednesday, Paul Allen, chief executive of Monsoon Accessorize, said: “We are pleased with today’s result and would like to thank our suppliers and landlords for their continued support.” Noteworthy, a significant majority of landlords approved the rent reduction proposals for both high street retailers.
“This action will help us to reshape our businesses for the future, and we will now turn our attention to the wider turnaround plan and delivering a sustainable and profitable business moving forward,” further added Allen.
Monsoon has 258 stores in Britain and Ireland, but said last month that its current rent bills are “unaffordable” due to the crisis on the British high street. It comes after Monsoon revealed that its credit insurance has been removed, meaning it must pay suppliers upfront.
Other measures in place to mitigate the retailer’s financial struggles include an emergency 12 million pounds emergency loan by the company’s founder Peter Simon. Terms of the deal stipulate that the loan will be repaid first if the company goes bankrupted. Simon has also provided a further unsecured credit facility of 18 million pounds at zero interest.