Retail giant Intu, which owns the Metrocentre in Gateshead and Eldon Square in Newcastle has said talks with lenders have failed to reach agreement and warned that it is on the verge of calling in administrators.
In a statement, the group, which has until midnight on Friday to reach a deal, said:
Discussions have continued with the intu Group’s creditors in relation to the terms of standstill-based agreements. Unfortunately, insufficient alignment and agreement has been achieved on such terms.
Intu owns a number of shopping centres in the UK.
Earlier this week the company voiced concerns that failure to reach an agreement could lead to shopping malls having to close their doors to customers.
Some centres have reduced rent collections as a result of COVID-19 and cash trapped under their financing arrangements which restrict their ability to pay for support, such as shopping centre staff, from other entities in the Intu group."
The company was in financial difficulty prior to the COVID-19 outbreak, but the forced closure of the company's store tenants during lockdown accelerated financial downturn.
It emerged earlier this month that KPMG had been appointed to make contingency plans for Intu's administration.
In the event that Intu Properties plc is unable to reach a standstill, it is likely it and certain other central entities will fall into administration.