Congratulations to Arcadia’s CVA creditors

Arcadia’s creditors were victorious in their battle against the company’s respective chairman and majority shareholder, husband and wife duo Sir Philip and Lady Tina Green

Creditors of a business that has recently entered a company voluntary arrangement (CVA) would be wise to follow the example set last month by the creditors of waning fashion retailer Arcadia.

Arcadia’s creditors did well to encourage Sir Philip Green and his wife to part with more money than they’d intended.

Simply by standing up for themselves and applying pressure at creditors’ meetings; creditors were able to get majority shareholder Lady Tina Green to inject an additional £50m of equity into the business.

Initially, Sir Philip tried to undermine creditors by making a lowball offer. His narrative is usually: “Play the game my way or I’ll let the company fall into a formal insolvency procedure.”

However, creditors stood firm, called his bluff, and compelled the Greens to release disbursements totaling £100m between March and June.

New skills

Perhaps this was always on the cards because although Sir Philip is great at dealmaking, takeovers and asset stripping; long-term retail success depends on a completely different set of skills.

In some ways, the Greens’ payments could be viewed as are the family returning dividends paid out since 2002, including more than £1.6bn from BHS and Arcadia.

Although perfectly legal, those disbursements were excessive. Furthermore, it would be fair to assume had the money remained in Arcadia there’d be no need for a CVA as the company would been a going concern with money in the bank.

Instead, the Greens have to put their hands into their pockets to pay Arcadia’s creditors, which really means they’re just lending the company its own money.

Commercial Debt Collection: Challenges and Best Practices


Commercial debt collection is the process through which outstanding debts owed by commercial entities are recovered, typically stemming from goods delivered or services rendered on…

Read More

Gibraltar Financial Services Commission: A Lesson in Financial Regulation


The recent collapse of High Street Group and its security trustee, Castle Trust Management and Services, prompts a closer examination of regulatory practices. Along with…

Read More
de trafford

De Trafford Third Party Recovery: An Update


The recent financial collapse of multiple DeTrafford property development companies hassignificantly impacted purchasers. As they navigate the consequences, a glimmer of hope arises asthe wheels…

Read More
Northumberland Living

Northumberland Living Developments: Allegations and Challenges


Northumberland Living, In West Chevington Farm, Druridge Bay, is a development poised for completion. Only to be stalled by an apparent unforeseen historical conveyancing issue.…

Read More