Peacocks' shareholders have stumped up £20 million to allow the value fashion retailer to continue with its ambitious store opening plans.

As reported in Retail Week, the retailer has been in talks with PwC and shareholders Och-Ziff and Perry Capital about rolling out stores at the same rate as its recent expansion drive.

Peacocks chief executive Richard Kirk said he wants to double the size of the retailer, which operates 500 stores in the UK. The retailer has been opening about 30 eponymous stores a year and about 10 Bonmarché. However, its banks refused to continue financing expansion.

Peacocks will now be able to spend up to£10 million of new equity a year on store openings. Och-Ziff and Perry Capital, which each own about 25 per cent of the group, will provide the funding.

The retailer reported a 5 per cent like-for-like uplift over the past seven weeks, with an 11 per cent margin.

Today, Kirk will present a new three-year plan to lenders, against which it is asking for more relaxed debt covenants. In exchange, Peacocks is offering its banks a 100 basis point fee and a 125 basis point increase to the margin on its loans.

Peacocks has£120 million of cash-interest bearing debt and about£100 million of mezzanine debt financing, whose interest is paid in kind.

Topics