Matalan lenders reportedly inching closer to takeover deal

A group of financial investors are said to be close to securing a deal to takeover British budget retailer Matalan in a bid to cement its short-term future.

The consortium, which includes the likes of Invesco and Man GLG, are understood to have proposed funds that would inject around 100 million pounds into the retailer, according to Sky News.

The publication noted that the group of senior lenders could strike a deal within the next fortnight.

Additionally, sources close to the situation reportedly said the lenders had been in talks with Nigel Oddy, Matalan’s interim chief executive, about making the role permanent if they succeed.

The first-lien lenders are directly up against Matalan’s own founder John Hargreaves, who entered the sales process with backing from American investor Elliott Advisers.

While all parties involved didn’t issue a comment to the media outlet, Matalan’s latest update on the matter came December 26, in which it stated it was aiming to complete the process before the end of January, 2023.

In a regulatory filing, the company said it was currently assessing the bids from “a number of interested parties”, noting that the group of lenders had further reconfirmed their commitment to a recapitalisation if necessary.

It added that all transactions under consideration would provide a material reduction of its debt, an extended debt maturity profile and any new funding that may be required.

Matalan is currently facing an imminent deadline to refinance 350 million pounds in debt, and recently took out a loan of 60 million pounds from its stakeholder Bantry Bay as it looked to strengthen its balance sheet.