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House of Fraser CVA legal action delays cash injection

Chinese investor C.Banner said it is delaying its £70m investment in House of Fraser until legal proceedings with a group of landlords of the department store’s Company Voluntary Arrangement are resolved.

The approval of the CVA was a prerequisite to the investment.

C.Banner was due to give more detail about its plan for HoF to shareholders on 26 July but instead filed a note to the Hong Kong Stock Exchange saying it may not be able to release details of its investment until 31 October, because of the legal challenge.

A group of landlords, who are advised by Begbies Traynor and JLL, officially filed a petition in the Scottish courts on 20 July. They are challenging the CVA proposals on the grounds of alleged “unfair prejudice against certain creditors, as well as material irregularities in the implementation of the CVA”.

Readers' comments (1)

  • Many hope the landlords win, especially when you couple in the fact that £70M isn't remotely enough to sort their issues out. Good money should never be thrown at bad.

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