Retailer’s Future in Question as Talks Loom Over Financing and Control
- Matalan lenders considering appointing advisors amid talks over retailer’s future financing
- Senior bondholders discussing options with Perella Weinberg Partners for £350m payment in early next year
- Junior lenders hire Houlihan Lokey as investment bankers to advise them
- Talks set to take place over the summer
- Matalan’s Q3 revenues increased 19% to £291.4m compared to 2020
- Operating profits up by 370% to £34.8m, pre-tax profits at £11m for three quarters
- Founder John Hargreaves may need additional funding to maintain control of the company
Matalan lenders are reportedly considering appointing advisors ahead of talks regarding the retailer’s future financing amidst economic uncertainty caused by the cost of living crisis. Senior bondholders are in discussions with Perella Weinberg Partners to explore options for a £350m payment due early next year, while junior lenders have appointed Houlihan Lokey as investment bankers to advise them. Sources close to the matter suggest that Matalan founder John Hargreaves may need millions of pounds in additional funding to maintain control of the company. The talks are expected to take place over the summer. In Q3, Matalan’s total revenues increased 19% to £291.4m compared to £244.8m in the same period in 2021, reaching a total revenue of £777.9m from £578.1m previously. Operating profits surged by 370% from £7.4m to £34.8m, while pre-tax profits for all three quarters amounted to £11m, up from a loss of £76.7m in the same period in 2020. Matalan and Hargreaves have been in the news after the founder lost a long-running court battle with HMRC over a potential £135m tax bill.
Factuality Level: 8
Factuality Justification: The article provides accurate and objective information about Matalan’s financial situation, its revenue and profit growth, and the founder’s tax dispute with HMRC. It cites credible sources such as Sky News and includes relevant details without any significant digressions or personal opinions.
Noise Level: 3
Noise Justification: The article provides some relevant information about Matalan’s financial situation and its founder’s tax dispute with HMRC but lacks in-depth analysis or actionable insights. It also contains some repetitive information and does not explore the consequences of decisions on those who bear the risks.
Financial Relevance: Yes
Financial Markets Impacted: The article discusses Matalan’s financial situation, its lenders, and potential future financing talks which may impact the company’s operations and control. It also mentions the founder John Hargreaves’ tax dispute with HMRC.
Financial Rating Justification: The article is relevant to financial topics as it covers a retailer’s financial performance, its debt obligations, and ongoing legal disputes related to taxes.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: There is no mention of an extreme event happening in the last 48 hours. The information provided discusses financial issues related to Matalan, a retail company, and its founder John Hargreaves’ tax dispute with HMRC.
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