BHS inches closer to rent cut deal that may stop it from going bust
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Version 0 of 1. BHS is inching closer to an agreement that will decide the fate of 10,000 staff, after its largest creditor agreed not to vote when the store requests deep cuts to its rent bill on Wednesday. The Pension Protection Fund, a Government backed rescue fund, has started a takeover of BHS pension schemes to protect pension-owners after it was decided that the store could not keep up with its debts. This fund has reportedly agreed to sit out of the vote over whether BHS's rent bill should be slashed this afternoon, which should make it easier for BHS to get the 75 per cent approval it needs to secure rent cuts that could stop many stores from going under. BHS owners Retail Acquisitions has asked landlords to slash rent by up to 50 per cent as 47 of its 164 stores to prevent job losses that would result in further store closures. Retail Acquisitions, which paid £1 to buy BHS from Topshop tycoon Sir Philip Green a year ago, has requested two Company Voluntary Arrangements, a kind of insolvency agreement that involves asking landlords to accept lower rents in loss-making stores. Malcolm Weir, head of restructuring and insolvency at the PPF, said it had "agreed in principle to abstain from the vote" while it worked to resolve the pension issue. "If the CVA is agreed, we will be working with the company over the coming months to find a solution. However failure to reach a compromise may still result in insolvency. Members of the pension schemes continue to be protected," Mr Weir said. BHS employs around 8,500 people directly and another 1,500 on contracts. Head office and store management jobs are also under threat from a restructure, the company has said.
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