Ashurst and Allen & Overy (A&O) are among a raft of firms advising as home improvement retailer Focus DIY moves to secure a rescue deal through a company voluntary arrangement (CVA).

Ashurst has been advising Focus DIY on the proposed CVA, which received more than 90% backing from creditors last month (24 August). It will see landlords of some 38 closed stores agreeing to waive rent liabilities in return for a share of a pot of money thought to be worth around £3.7m.

The closed stores had been costing Focus around £12m each year in liabilities. In addition, landlords of Focus stores still in operation have agreed to accept monthly rental payments instead of large quarterly bills.

Focus, which has been an Ashurst client since 2007, turned to restructuring and insolvency partner Giles Boothman, who headed a team that also included finance partner Jane Fissenden.

A&O acted for the banks, GMAC Financial Services and HBOS, with banking partner Ian Powell leading the team. Nabarro, Shoosmiths, Forsters and Manches were among the firms acting for the landlords, which include British Land and Land Securities.

Earlier this year sports retailer JJB Sports secured a CVA agreement with its landlords, in a deal which saw Herbert Smith advising JJB.

Boothman told Legal Week: "This provides a realistic option for other companies to use CVAs to restructure." their balance sheets without going through a pre-pack or other more destructive insolvency processes."

Contrary to what some commentators might think, the British Property Federation and many of the big landlords have given this process their full support."

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