tit-for-tat:-ann-summers-launches-cva-following-rent-dispute-during-pandemic
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Ann Summers has launched a Company Voluntary Arrangement (CVA) following a dispute over the lingerie brand’s rents during the pandemic.

The CVA follows extensive discussions with the company’s landlords over plans to switch to turnover-based rents due to changing consumer behaviour during the coronavirus crisis.

Read more: Ann Summers warns landlords over potential CVA

Ann Summers said it wants to ensure “the company’s property costs reflect today’s much-changed market conditions” and enables “the risks of the current trading environment to be more equitably shared between the business and its landlords”.

The CVA will only affect 25 of the retailer’s 91 high street stores, with revised terms already agreed on for the remaining two-thirds. 

The firm benefitted from a surge in demand during the coronavirus lockdown, meaning the company expects to improve upon the £16m loss it recorded last year. 

However the acceleration of the shift to online shopping during the coronavirus pandemic has forced bricks-and-mortar retailers to adapt. 

Additional funding of up to £10m will be handed to Ann Summers if the CVA is approved, as part of plans to boost the board’s growth plans.

Ann Summers chief executive Jacqueline Gold said the firm “has a bright future” but warned: “We need to align our property costs so they reflect the challenges facing today’s high street… if the business is to fulfil its potential and prosper in the post-Covid trading environment.”

“I’m grateful to the majority of our landlords who have worked constructively with us to agree sensible terms on the vast majority of our stores, and these landlords will not be affected by the CVA,” she added.

“We continue to invest in our marketing, our product and our brand, and are seeking
to protect as many stores and jobs as we can through this process.”

Read more: Peacocks offered lifeline with management buy-out proposal that could save 5,000 jobs

FRP Advisory have been appointed to oversee the CVA, which will be subject to a creditors’ vote on 23 December, needing more than 75 per cent support to proceed.

Ann Summers joined a group of retailers to write to the Treasury in February this year, calling for it to take action on business rates, which they said had “come unsustainable for many retailers”.

The post Tit for tat: Ann Summers launches CVA following rent dispute during pandemic appeared first on CityAM.

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