Micro Anvika, the Tottenham Court Road based electrical retailer, is proposing a company voluntary arrangement in order to restructure and survive according to The Register Magazine.
The retailer has 7 stores and a concession in Harrods but it has been hit hard by the fall in consumer spending on some big ticket items, as well competition from the internet. The proposal will mean that it can close some of its loss making stores. The company turned over £30m last year but that was down from £43m 2 years previously. The company accounts show that it made a loss last year of £993,000. The overall debts of the company are not known at this time.
In order to persuade the creditors to agree to the restructure the board of directors will not be taking any pay rises or bonuses and the shareholders will not receive any dividends. This is according to the letter to creditors that was leaked to The Register. Quite right! If the directors and shareholders are to ask the creditors to take a hit on their debt then they need to be seen to be doing all they can to support the business. A CVA requires grit and determination from the directors in order to succeed.
The creditors meeting for the CVA is in March.