Finnish retailer Stockmann turns to leasing back its properties

Lindex Oyj

14/12/2020 07:41

HELSINKI, Dec 14 (Reuters) - Struggling Finnish retailer
Stockmann  STCBV.HE  plans to sell and lease back its flagship
department store properties located in Helsinki, Tallinn and
Riga in order to save itself from bankruptcy, it said on Monday.
    In April, Stockmann filed for corporate restructuring, a
form of administration in which a court appointee is charged
with restructuring the company to avoid bankruptcy.  urn:newsml:reuters.com:*:nL8N2BU164
    Known for its upmarket department stores, Stockmann has
struggled in recent years in the face of a consumer shift to
online shopping, prompting cost cuts and divestments but
eventually it was the coronavirus that led it to restructuring.
    On Monday, the administrator of Stockmann's restructuring
proceedings filed with the Helsinki district court his proposal
for the group's debtors.
    "The programme is supported by the company's largest
creditors, the committee of creditors and the largest
shareholders (representing 45.3% of shares and 62.6% of votes)
as well as the company's Board of Directors and management,"
Stockmann said in a statement.
    In addition to Stockmann continuing its department store
operations with the sale and lease-back arrangement, the plan is
that its profitable fashion chain Lindex will stay under the
ownership of the Stockmann Group, it said.
    The sale of Lindex was previously among the options being
considered for the restructuring.
    "In accordance with the draft restructuring programme the
company has 433.5 million euros in secured restructuring debt,
195.7 million euros in unsecured restructuring debt and 108.1
million euros in hybrid bond debt, totalling 736.9 million euros
 ($894.8 million)," it added.
    The restructuring programme stretches over eight years and
altogether 20% of unsecured debts will be cut while reserving
the creditors the opportunity to convert this 20% share of the
restructuring debt into the company's series B shares before any
cuts are made, Stockmann said.  
        
    

($1 = 0.8235 euros)

 (Reporting by Anne Kauranen, editing by Louise Heavens)
 ((anne.kauranen@thomsonreuters.com; +358925166112;))