Lenders for Matalan have agreed to take ownership of the fashion chain in a recapitalisation process which will end founder John Hargreaves’ control of the retailer.
A group of lenders, led by Invesco, Man GLG, Napier Park and Tresidor, have sealed the deal after Matalan launched a sales process in September, writes the Press Association.
The transaction is due to complete on 26 January.
The lenders have cut the group gross debt by £257m to £336m and agreed up to £100m in new growth funding as part of the deal.
In a statement Stephen Hill, Matalan’s chief financial officer, thanked Hargreaves and said:
Matalan is a fantastic business and I am pleased that with the support of our first lien noteholders, its ongoing future has been secured via a materially lower level of debt and a reset balance sheet.
It is clear in our third quarter and recent trading performance that whilst the market remains challenging, customers have demonstrated a strong affinity to our brand and proposition, evidenced from our robust and ongoing sales growth. However, the business must continue to adapt its approach to such market conditions, increasing its level of agility and margin resilience.