Dutch government looks into state support for Hema: FD
The government is considering propping up high street staple Hema and has asked merchant bank Lazard to assess what role the state could have, the Financieele Dagblad reported on Friday.
One option being considered is a state guarantee for new loans, the FD said, quoting sources close to the talks.
Government officials are monitoring the company’s financial health carefully because it is a major employer – with some 9,500 workers in the Netherlands alone, the paper said.
An eventual bankruptcy would also have a major impact on shopping streets, which are already being hit by rising vacancy rates.
A dramatic 30% fall in sales caused by the coronavirus crisis prompted Hema CEO Tjeerd Jegen in March to tell landlords and staff – but not shareholders – to make financial sacrifices.
A letter outlining the measures said that ‘as a consequence of the closure of the shops in the countries around us and the continuing loss of revenue in the Netherlands, the survival of the company will shortly be in doubt.’
Hema, bought by Marcel Boekhoorn only 18 months ago, has been loss making since 2013 and has been saddled with debt by several private equity owners, most recently Lion Capital.
The Dutch government has so far been involved in two major corporate rescues in recent months.
Airline KLM is to be given a loan of between €2bn and €4bn, but those talks are still underway.
In addition, shipbuilder IHC has had a direct loan from the government and a guarantee to cover part of its bank debts. Lazard, the paper points out, was involved in that rescue operation as an advisor to IHC.
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