Connect with us

Hi, what are you looking for?

Investing

Caffè Nero landlords threaten revolt against CVA proposal

Cafe Nero

Caffè Nero could face a legal challenge despite winning backing from creditors to pursue a company voluntary arrangement.

The coffee chain’s plan was thrown into confusion by an eleventh-hour bid from EG Group, controlled by the billionaire Issa brothers. The approach was rebuffed, although it is understood that Mohsin, 49, and Zuber, 48, who are buying Asda from Walmart, remain interested. Under EG’s bid, landlords would have been paid in full for rent arrears during the pandemic, compared with 30p in the pound under the CVA.

Under insolvency law, creditors can challenge the outcome of such a restructuring plan within 28 days. Lawyers for EG Group have written to Caffè Nero to highlight the strong possibility of a landlord revolt.

Melanie Leech, 58, chief executive of the British Property Federation, said: “It can’t be right that a CVA is being used in this way, forcing property owners, many of them small independents reliant on store income for their pensions, to absorb such huge losses, when Caffè Nero has received significant support from government over the past several months and failed to engage adequately with property owners prior to its CVA launch.”

Terje Gilje, 59, a landlord owed £208,000 for a branch in Kensington, west London, said that he would join a legal challenge to the CVA. He said: “I think it’s outrageous that they didn’t delay. I suspect that you will find a group of landlords will gain momentum and will go ahead and challenge it.”

A source close to the CVA denied that there was poor landlord engagement. The group, which is using the insolvency process to switch to turnover-related rent, said that more than 90 per cent of creditors had voted in favour of the proposal yesterday, while it had the support of more than 80 per cent of landlords.

Caffè Nero has more than 5,000 staff in 800 branches in the UK. According to the CVA documents, landlords are owed arrears of £110.3 million, All Souls College, Oxford, is owed £321,000 and Heathrow is owed £2.7 million.

Caffè Nero said: “The approval of this CVA by the company’s creditors safeguards the immediate future of the business and provides a sustainable platform from which the company can navigate the challenges ahead and rebuild sales momentum.”

EG said that it regretted that “Caffè Nero’s creditors did not have an opportunity to consider our proposal fully, as we believe it would have delivered a stronger outcome for all stakeholders, including employees and landlords”.

Read more:
Caffè Nero landlords threaten revolt against CVA proposal

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

THE DEPARTMENT of Public Works and Highways (DPWH) said Tuesday that it will support local government units (LGUs) and map out a clear division...

Economy

A TOTAL of 4.73 million coronavirus vaccine doses procured under a World Bank loan have arrived in the Philippines, the bank said. Over eight...

Economy

THREE INDIVIDUALS filed a complaint before the Office of the Ombudsman against Energy Secretary Alfonso G. Cusi and other officials, alleging corruption in connection...

Economy

A NON-GOVERNMENT organization (NGO) urged candidates running for President to reveal their views on how they plan to govern with borrowed money. Freedom from...

Economy

THE BOARD of Investments (BoI) said it recently approved an application for incentives of Libertad Power and Energy Corp. for a 6-megawatt (MW) biomass...

Economy

THE DEPARTMENT of Agriculture (DA) lifted a ban on cattle imports from Brazil after a finding that cattle from that country have a negligible...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Investing

As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...

Economy

Pfizer Inc on Wednesday raised its 2021 sales forecast for its COVID-19 vaccine by 29% to $33.5 billion, and said it believes people will...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.



Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!