Saffron Walden's Beales gets stay of execution
PUBLISHED: 09:30 31 March 2016 | UPDATED: 09:30 31 March 2016
Beales in Saffron Walden will remain open for at least the next 10 months after a reduced rental agreement was reached with creditors last week.
The Market Street clothing and homeware store will pay 30 per cent of its rent for 10 months after proposals for a Company Voluntary Arrangement (CVA) were accepted by creditors at a meeting in London on March 24.
The Beales Department Store Group, which has 29 branches across the country, says the decision will give Beales the chance to “restore the group to financial health”.
The arrangement will, for the time being, save 30 jobs at the store with further discussions with the landlord expected to take place during the 10-month reduced rent period.
A spokesman for Beales said: “Saffron Walden is one of the stores where a reduced rent, equivalent of 30 per cent, will be paid for a period of 10 months, during which time we will engage with the landlord to agree the basis of any continued trading from this site.”
A company can only propose a CVA when the alternative is administration, and more than 75 per cent of creditors had to vote in favour for the resolution to be passed.
More than 90 per cent of the votes cast in London last week were in favour of the landlord-only CVA proposed by the company.
Beales chairman Stuart Lyons said: “This vote gives Beales a unique opportunity to restore the group to financial health.”
Rob Croxen, restructuring partner at auditor KPMG, said: “The creditor vote in favour of the CVA proposal will allow Beales to take its first critical step towards turning the business around. This is a positive outcome for Beales’ creditors and good news for customers and employees.”
Wendy Howell, Saffron Walden Town Team member and Design Essentials owner, said: “I’m delighted to hear that an agreement has been reached and I’m hopeful that Beales will be able to stay open beyond the 10 months.
“It would be devastating, and a massive loss to the town, if it were to close. Having a big vacant store in the square would not do anything to improve footfall, which is already down by approximately 40 per cent.”
Town mayor Heather Asker added: “I’m very, very pleased for Beales. It is an imposing centre piece of the Market Square and it needs desperately to stay open in order to keep the square alive.
“It is promising that they have a stay of execution, but I would say that the public needs to support the store by shopping there, and not just taking the attitude that it would be a shame if it does go.”
“Retail is such a competitive market, with online shopping and shopping centres elsewhere, but think it would cast a shadow on general trade in the town should it close.”