30th Aug 2018 06:52
LONDON (Alliance News) - Homebase currently owes more than GBP1.00 billion to employees, landlords and creditors, but has just GBP151 million to repay them if it goes bust, The Daily Mail reported late Wednesday night.
According to High Court documents seen by the newspaper, the DIY retailer's finances came short of the amounts owned to its creditors as it prepares to vote on a company voluntary agreement later today.
Earlier in August, Homebase announced plans to close 42 stores and secure rent reductions of between 25% and 90% of other 70 stores in a bid to avoid bankruptcy.
The Daily Mail reported that if the CVA is not approved, the company could fall into administration, owing creditors GBP1.2 billion and putting 11,000 jobs at risk.
In case of a collapse, creditors face receiving less than 10 pence for every GBP1 owed, the newspaper added.
However, the Daily Mail said that restructuring experts at Alvarez & Marsal, who are in charge of carrying out the CVA, will receive GBP830 per hour fro working on the deal, with a minimum of GBP750,000 in the proposals are approved.
http://www.thisismoney.co.uk/money/markets/article-6111429/Homebase-crippled-1-2bn-debt-pile-151m-pay-creditors-rescue-fails.html