Barclay Family Faces Financial Turmoil as Very Group Credit Rating Drops Further

The Barclay family’s retail empire, The Very Group, has suffered another financial blow as its credit rating was pushed deeper into junk status by Fitch Ratings. The company, which carries debts exceeding £2 billion, has now been downgraded from B-minus to CCC-plus. This reflects a significant risk of default on its loans, raising serious concerns among creditors.

The downgrade places the group under a “ratings watch negative,” highlighting Fitch’s growing apprehension about its ability to refinance debt. The situation also means that any further borrowing by the company could face considerably higher interest rates. This development exacerbates the pressure on The Very Group’s owners, who are already battling financial challenges across their corporate network.

Efforts to stabilise the situation include plans to sell The Very Group, which Fitch expects to be completed by the end of 2025. The transaction could mark a significant shift in the company’s ownership, providing some relief to creditors as the family works to address liabilities linked to their other holdings.

RedBird IMI, a joint venture involving Sheikh Mansour bin Zayed al-Nahyan, is one of the group’s largest creditors, alongside International Media Investments, the Sheikh’s private venture. Together, they are owed £1.2 billion by the Barclay family’s entities. To recover this debt, RedBird IMI has also put The Telegraph newspapers on the block, although the sale has been sluggish, with bidders seemingly unwilling to meet the £500 million asking price.

The urgency around these sales is tied to approaching debt maturities. The Barclays’ debts to RedBird fall due in November, while The Very Group’s debts mature between February and August 2026. Fitch believes that a consensual and orderly change of control could resolve much of the uncertainty regarding the group’s future, provided refinancing is secured before these repayment deadlines.

The Barclays have maintained optimism despite their mounting financial troubles, with a family spokesperson citing confidence in their “good track record of refinancing early.” However, market analysts are less assured, underscoring the necessity for swift action to avoid an insolvency scenario. Whether the group can navigate these turbulent waters without severe disruption remains to be seen.