Caffè Nero has approved its Company Voluntary Arrangement (CVA), including a modification that the company will ensure compromised creditors, including landlords, will have their arrears paid in full in the event that a sale of the group to the third party occurs within the next six months.

In excess of 90% of creditors voted in favour of the proposal, with the CVA now formally approved.

Nero said the proposal received the support of an “overwhelming majority” of landlords.

A spokesman for Caffe Nero said: “The directors are extremely grateful to its landlords, business partners, suppliers and other creditors for their support and understanding in the process during these challenging times.

“After the devastating effect caused by the pandemic on Caffe Nero, the approval of this CVA by the company’s creditors safeguards the immediate future of the business, and provides a sustainable platform from which the company can navigate the challenges ahead, and rebuild sales momentum over the medium to longer term.”

It is not clear how many of Nero’s 800 cafes are at risk of closure following the CVA, though the focus of the plan is thought to be to switch to a turnover rent model.

The modification in the CVA comes after Caffe Nero rejected a takeover bid from petrol forecourt operator EG Group.

Billionaire brothers Mohsin and Zuber Issa, who are in the process of buying Asda, warned Nero that its proposed restructuring would face a legal challenge after the coffee shop chain snubbed their offer.

Sky News reports lawyers for EG Group have written to Caffe Nero’s parent company to highlight the likelihood of a landlord rebellion against CVA.

Under the CVA, which is being run by KPMG, landlords face losing the majority of the rent arrears they are owed, while EG promised to pay them in full - a sum understood to be worth tens of millions of pounds.

Caffe Nero dismissed the bid as “an unsolicited, highly uncertain approach” and said “any transaction would be subject to a period of detailed due diligence, as well as the agreement on the terms of any sale, and would require the consent of the group’s external lenders and shareholders”.

Meanwhile, Black Sheep Coffee made an appeal to raise money to take over Caffe Nero sites at risk of closure, in a big to “rid the world of boring, average-tasting coffee”.

Co-founder Gabriel Shohet appealed to Nero landlords, who feel they are getting “the short end of the stick” out of the CVA, as well as investors and its own customers to snap up at-risk cafes.