Vivarte obtains lenders’ consent to restructure debt
Today is a very important day for Vivarte - as is tomorrow. On Thursday July 31, the retail conglomerate’s management, led by its president, Marc Lelandais, announced having obtained the unanimous agreement of its 116 lenders to allow the company to sharply reduce its debt and strengthen its financial capacities.
The agreement was submitted for approval on Thursday during a hearing at the Paris’ tribunal de Commerce. The court will render its decision tomorrow - another very important day for Vivarte. The group's management is confident of a positive outcome.
Clearly, without prejudicing the court’s decision, the agreement reached between the company’s management and the lenders should come as a huge relief for the company, made up of 22,000 employees.
The terms of the agreement as alluded to by Vivarte are consistent with what has already been written. Evidently, the group's debt has been reduced from 2.8 billion to 800 million euros! The new shareholders are committed to bringing forward 500 million euros in new resources to strengthen the group’s financial capacities and to support its investment programme.
If the agreement is approved, Vivarte will find itself with new key shareholders “renowned in the world of investment”: Oak tree, Alcentra, GoldenTree and Babson. Governance will be handed over to a board consisting of representatives of shareholders, management and industry experts.
Marc Lelandais sees a way to continue and even step up the strategy he has employed since his arrival at the head of the group in mid-2012.
“The success of the financial restructuring, which I initiated and conducted under the legal expertise of Hélène Bourbouloux, is a crucial step in the recovery plan that has been pursued since I became head of the group in mid-2012. Vivarte now enjoys a healthier and stronger financial situation that will enable it to pursue its development strategy, consolidate its status as a major player in French consumer fashion, and give it the means to truly expand online and internationally. In an economically difficult environment, Vivarte - supported by a new group of shareholders who are confident in the plans that are being undertaken - will be able to continue its work in modernizing and adapting to new market conditions," Lelandais explained.
Indeed, if the financial battle is won, what remains is to make the actions taken to revitalize the group's retailers, in particular La Halle, convincing.
The results of these actions will be talked about in the months and seasons to come...
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