Revolution Bars has confirmed it will launch a CVA proposal in order to reduce the size of its estate as the group continues to struggle with government trading restrictions.
The company revealed plans to close some of its 76 venues across the UK after the 10pm curfew law saw sales in October drop to 49.4% compared to 72.5% in August 2020.
It said its board will now propose a restructuring of Revolution Bars property interests through a CVA of one of its subsidiary entities Revolution Bars Limited (RBL).
Under the terms of the proposed CVA, RBL expects to exit six bars, and obtain materially improved rental terms on seven others. In addition, the group will write-off 50% of the £30.9m debt owed by RBL to the company.
The attendant RBL creditors’ meeting is scheduled to take place on 13th November 2020.
It follows an announcement by the board last month that it was considering a restructuring process after it admitted it was “exacerbated “ by further Covid-19 related restrictions, at the time the board of Revolution confirmed that it “has been working with advisers to assess various strategic options for the group.”
Chief executive Rob Pitcher said: “Throughout this extended period of distress caused by COVID-19, the group has sought to prioritise the health and well-being of its staff and customers, minimise its cash consumption, maintain good levels of liquidity to ensure its ongoing viability and to be in a position to take advantage of opportunities that may arise once restrictions are lifted.
“The CVA proposed by the group’s Revolution Bars Limited subsidiary entity, if agreed by landlords, is another proactive step to lower outgoings to help safeguard the future of the Group and improve long-term performance.”
It is not yet confirmed which UK sites will be forced to close.