Will Superdry’s Oxford Street landlord challenge its restructuring plan?

One of the biggest barriers to the smooth agreement for a retailer restructuring plan is its landlords. And Superdry could see some heavyweight opposition to its recently announced proposals.

Sky News reported that owner of one of its key stores — the 32,000 sq ft London flagship on Oxford Street that opened with a publicity blitz only in late 2021 — has drafted in lawyers to scrutinise its plans.

M&G is reportedly “weighing a challenge” to the rescue plan that is said to involve major rent cuts for its landlords. But while Sky also stressed that the asset manager’s move won’t necessarily result in a formal legal challenge, it cited “property industry sources” saying it was definitely a possibility.

Other landlords, including property giant Landsec (which is the majority owner of Bluewater where Superdry also has a prominent store), are monitoring the situation ahead of detailed proposals that are due to be shared next month.

The report said the landlords are “believed to have been alarmed by the absence of their participation in a mechanism to allow creditors to benefit from any future recovery in the retailer’s performance”.

That’s understandable with property owners likely to expect some kind of boost further down the line if they accept some level of pain right now.

Superdry is aiming to avoid a raft of store closures in the short term by imposing big rent cuts at dozens of locations.

It said it was aiming to secure its long-term future and hopes its landlords will support it in this.

Superdry was once flying high with a share price around six years ago of over £20 each giving it a value of more that £2 billion. The shares closed last week at just 7.49p each, giving the firm a market value of less than £7.5 million.