British fashion retailer Matalan has asked two of its existing lenders, Barclays and Lloyds, to inject £50m of government-backed funding to prevent its business from running out of cash – after suffering the impact of the coronavirus lockdown.
In the latest hit to the British high street, the firm’s billionaire founder and owner John Hargreaves is reportedly not going to use his own wealth to bankroll the company.
Matalan has furloughed more than 11,000 employees since the lockdown, and has suffered from a sharp drop in sales since being forced to shut its 232 store. The company has also deferred rent payments and offered to pay suppliers just 70% of its bills for April, May, June and July.
When the coronavirus pandemic struck the UK, Matalan’s appointed advisers from Deloitte to help raise emergency funds to keep it from falling into administration. However, other investors did not provide a cash injection because Hargreaves was not willing to invest his own money.