Matalan’s lender are reportedly preparing for crunch talks about the chain’s future financing against a backdrop of soaring inflation and deepening economic gloom.
According to Sky News, the retailer’s senior bondholders are lining up Perella Weinberg Partners to advise them on their options with a £350m repayment due to take place early next year. More junior lenders, meanwhile, who are said to be owed about £80m, are close to appointing Houlihan Lokey to advise them.
Sky cited City sources as saying that talks about a refinancing of Matalan’s balance sheet were expected to move forward in the coming weeks.
Founder John Hargreaves is likely to need to inject tens of millions of pounds of additional funding in order to retain outright control of the company, they added.
It was understood that while details have yet to be finalised, the impending appointment of advisers to two sets of lenders underlines the significance of talks that will take place during the summer.
The talks involving Hargreaves have been given added impetus by a legal ruling in February that he must pay £135m in taxes relating to his sale of shares in Matalan more than 20 years ago.
Matalan said in February that it was “continuing to evaluate alternatives and monitor market conditions with respect to a potential refinancing of its outstanding indebtedness”.
