Moss Bros eyes store closures and move to turnover-based rents in CVA proposal

Bick said prior to the coronavirus outbreak the group was trading robustly versus last year.

He said: “With the introduction of further lockdown measures, and with the outlook for trading remaining depressed, the group now faces no alternative but to try and limit our fixed costs and we have therefore made the tough but essential decision to undertake a CVA in order to protect the future of our business and people.”

Will Wright, partner at KPMG and joint nominee of the CVA, said: “Restrictions on large gatherings have had a savage impact on Moss Bros, and without taking further action, the situation facing the company is perilous. The CVA proposals put forward today seeks to strike a fair compromise for creditors, while providing the business with the lifeline it needs to be able to emerge from the crisis.”

The principle objectives of the CVA are as follows for 142 leases across various properties, of which most are shops:  

-To retain the majority of sites on current terms with the vast majority having a turnover based element (81 leases)

-To move a number of sites to a turnover-based rent (35 leases)

-To exit a small number of sites which could be up to 24 leases, but depends on landlord negotiations.

Creditors, including landlords, are expected to vote on the proposals next month.