Go Out­doors cred­i­tors to get just 1p per £1, warns Deloitte

The Daily Telegraph - Business - - Business - By Laura Onita

UN­SE­CURED cred­i­tors of Go Out­doors, the chain bought back by JD Sports in a pre-pack ad­min­is­tra­tion, could re­coup just 1p in ev­ery £1 owed.

JD Sports, the FTSE 100 sports­wear seller, has said it will pay the tax­man, its branded stock sup­pli­ers, cus­tomers’ re­turns and gift cards. But any­one else will likely be left out of pocket, in­clud­ing landlords, ad­min­is­tra­tor Deloitte’s state­ment of pro­pos­als has shown.

Last month, the re­tailer reac­quired Go Out­doors for £56.5m af­ter it was put into ad­min­is­tra­tion. The deal typ­i­cally sees a busi­ness placed briefly into in­sol­vency then sold back to its orig­i­nal owner, al­low­ing it to write off debts. All jobs were pre­served.

The ad­min­is­tra­tors re­ceived five of­fers in to­tal as part of the ac­cel­er­ated sale process, ac­cord­ing to the re­port at Com­pa­nies House.

Deloitte has granted JD a li­cence to keep Go Out­doors’ 67 branches open while it rene­go­ti­ates cheaper rents. If it does not suc­ceed, some will likely shut.

JD Sports, which is worth £6bn, paid £112m for the chain four years ago but blamed the pre-pack on in­flex­i­ble leases, agreed be­fore it took over.

Peter Cowgill, ex­ec­u­tive chair­man of JD Sports, has been on a rent rene­go­ti­a­tion cru­sade, par­tic­u­larly af­ter he was forced to shut al­most all of its stores around the world due to lock­down.

“As a rep­re­sen­ta­tive of the stronger re­tail­ers who at­tract foot­fall, I’m tired of sit­ting next door to oc­cu­pants who are pay­ing 30pc to 40pc less for the same box be­cause they have a lease break or an ex­piry or have gone through an in­sol­vency process,” he told

The Daily Tele­graph this month. “There has to be a realign­ment. Stronger ten­ants shouldn’t be sub­si­dis­ing the weaker ten­ants.”

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