Superdry (LSE: SDRY) is poised to unleash a brutal restructuring that will see its landlords shouldering the burden. The company is expected to outline plans as early as Tuesday for a formal restructuring proposal that will demand hefty rent reductions across a large portion of its British stores, reports Sky News.
While Superdry does not intend to announce permanent closures of any UK outlets, landlords dissatisfied with the terms will have the option to terminate leases.
Superdry’s suppliers are anticipated to escape relatively unscathed.
The survival plan comes after talks regarding a potential takeover by founder Julian Dunkerton collapsed last month. Superdry revealed it remained in negotiations with Dunkerton “in respect of alternative structures, including a possible equity raise”.
Superdry’s shares have plunged to around 8.00p, down over 90% over the past 12 months, valuing the debt-laden company at less than £9 million. The retailer recently agreed to increased borrowing with Hilco Capital and owes tens of millions to Bantry Bay.
Dunkerton, who owns just under 30% of shares, has been instrumental in raising cash, including through brand offloading in regions like India and Asia-Pacific.
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