Punch debt restructuring plans shelved

A DEBT restructuring deal at Punch Taverns has been withdrawn, just days before a vote was due on its plans.

Punch, which racked up more than £2bn of debts after an expansionary period, had warned that the deal was vital to its future. Executive chairman Stephen Billingham had said that failure to agree the deal “will lead to a much worse outcome with considerable uncertainty for the business and potentially significant loss of value”.

Without a restructure, it is expected to default at which point its securitisation cash resources will be “severely depleted”, with the mandatory repayment of £188m of cash at par, with a loss of £52m group cash contribution.

In a statement to the stock exchange, Punch said that a consensual restructuring “is in the best interests of all stakeholders”, and is looking for agreement before its next covenant reporting date of 15 April.