Landlord anger at Optical overhaul
Published 15/10/2013 | 18:06
Opticians and glasses chain Optical Express has come under fire fro m some of the UK's largest landlords over a controversial restructuring move that will leave them out of pocket.
Glasgow-based Optical Express called in administrators Begbies Traynor for its DCM Optical Clinic business late last week before buying back 16 of the 19 stores immediately as part of a so-called pre-pack deal.
Optical Express made the same decision just a year ago to call in administrators for another of its subsidiaries, which operated 80 stores.
It bought back 40 of these stores and the remaining shops were closed.
The British Property Federation (BPF) has written to Begbies Traynor demanding answers over the latest administration, which will leave them owed three months' rent, as it comes when the next quarter's rent payments are due.
Optical Express chairman and chief executive David Moulsdale said last month on revealing plans for the move that there would be no job losses, no patient disruption and no product trade supplier loss.
The group said it would complete its year-long restructuring, putting it in a " position of strength to deliver growth, stability and profitability."
But landlords have been left furious by the administration.
Ian Fletcher, director of policy at the BPF, said: " It would be improper use of the insolvency system if companies were able to pick and choose which parts of their contractual commitments they would like to walk away from in order to improve the profitability of their overall business, and leave some creditors with unfulfilled contracts."
He added: " It is simply not true in this case that there will be 'no supplier loss'. Landlords are suppliers with shareholders, pensioners and other investors."
Optical Express, which employs around 1,800 staff, was recently saved from collapse after a deal by Mr Moulsdale to buy the group's outstanding debts owed to lender Royal Bank of Scotland after the bank reportedly refused to lend it any more money.
The most recent accounts show Optical Express saw pre-tax losses widen to £15.1 million last year from £1.5 million in 2011 after suffering a 10% fall in group sales to £169 million.
The group was founded in 1991 and has since grown rapidly, expanding into laser eye surgery, as well as dentistry and cosmetic surgery.
A spokesman for Optical Express said: " Had this course of action not been taken the subsidiary business in its entirety was unsustainable - this action has saved and protected hundreds of jobs and many, many supplier contracts."