Homebase pays £132m to Hilco after Covid holiday pay and rate cuts

Homebase was hit hard at the start of the lockdown but was allowed to reopen with restrictions as the rules were relaxed in May 2020. Photo: John Nguyen. /JNVisuals

British restructuring specialist Hilco saved Homebase in 2018 by buying the retailer from its Australian owner Wesfarmers for just £1.

Hilco's original £132m loan is believed to have been granted . to fund Homebase's post-rescue overhaul.

Accounts for the year ending December 26, 2021, which were filed with Companies House last week, almost nine months after the legal deadline, show that Hilco provided auditors with a «letter of comfort» that they would invest more if necessary. capital so that Homebase can be signed up as a going concern — accounting jargon that means the business can continue to trade for the foreseeable future.

Homebase said it had £20 million in cash reserves when it signed the bills on May 26. , 2023

«While the cost of living crisis continues to be a significant problem in the UK and Ireland, the director believes the business remains resilient and well positioned to manage the working capital and financing needs of Homebase Group «, — said the leaders.

The company employs 5,600 people across 160 stores across the UK and Ireland.

Homebase and Hilco declined to comment.

Unlike other retailers, Homebase has not refunded government support it has received . handed over during the coronavirus pandemic.

While the company was under no obligation to do so, companies such as Tesco, Morrisons, Asda, Sainsbury's, Aldi, Lidl and discount retailer B&M decided return tax on business rates. relief after being able to continue trading during the lockdown.

Homebase was not alone in deciding not to return the money. Frozen food giant Iceland has decided to keep £40m and boss Richard Walker has approached Tesco for refusing and paying back the money after public backlash.

He previously said: «It's important to understand that Iceland is not Tesco, which initiated paying off business rate benefits.

“We just can't afford to pay him back. If we had been told to treat it as a loan, we would have acted differently.”< /p>