Stylo faces bleak future after rescue plan is rejected
SHOE group Stylo will appoint administrators today after creditors rejected its rescue plan.
The move means a bleak future for the Bradford group’s 5,450 employees with many of its 500 shops set to be closed.
The struggling company, which owns the Barratt and Priceless store chains, put forward an innovative Company Voluntary Arrangement (CVA) to its creditors as an alternative to a pre-pack administration.
Under the scheme, run by administrators Deloitte, landlords and creditors were asked to renegotiate debts so the company could stay afloat.
However that move was rejected by creditors and landlords at a meeting in London yesterday. The Stylo board said it was “disappointed” by the rejection of the CVA scheme.
Landlords, led by property company Hammerson, had feared the scheme could set a precedent where retailers jettison their worst performing properties leaving landlords with hundreds of empty shops.
While the CVA scheme would have seen around 150 stores and 2,000 jobs likely to be lost from the group, Stylo chairman Michael Ziff, whose family own 65% of the company, has warned that all the jobs would be at risk if the CVA was not approved.
Dan Butters, Neville Kahn and Lee Manning from Deloitte will be appointed joint administrators to the group later today.
Mr Butters said: “Following the meeting and vote yesterday we confirm that creditors and landlords have not accepted the CVA proposals.
“As a consequence we will now seek to achieve a sale as a going concern to preserve as many jobs as possible. We are in focused talks with interested parties in an effort to deliver a swift solution.”