US Edition Under the terms of the CVA, creditors to Focus will agree to accept a proportion of what the chain owes them. The retailer needs 75pc of creditor support for the CVA to take effect.
The bulk of Focus's creditors are landlords and last night the British Property Federation (BPF), which represents landlords, said that the CVA will be voted through, adding that Focus's "transparent" dealings should be held up as an "exemplar for future deals".
However the BPF also called for tougher controls on insolvencies. Its call was backed by Aviva, British Land, Hammerson, Hermes and Land Securities.
The Focus CVA will see leases for empty stores bought off with two lump sums equivalent to six months' rent. The DIY chain has 180 stores still trading and has 38 closed outlets, which cost it £12m a year in rent.
The company's lenders, HBOS and GMAC, will grant a two-year extension to the company's £50m revolving credit facility, which is due to expire at the end of 2009.
The BPF has been pushing for tighter insolvency controls to stop landlords being effectively held to ransom over CVA and pre-pack deals. Liz Peace, chief executive of the BPF, said: "We also need an insolvency regime that strikes a fairer balance between the rights of the insolvent and debtors. We will see more and more CVAs and pre-packs in the coming months, so it's vital that insolvency regulation has enough teeth."
Bill Grimsey, chief executive of Focus, said: "If we weren't in recession, Focus could be making more than three times what we are today. But the flexibility of our landlords will save thousands of jobs and that's why we owe it to them to be wholly transparent."
Rupert Clarke, chief executive of Hermes and president of the BPF, said: "We hear a lot about ghost towns and that's why landlords are committed to helping their occupiers as far as they can.
We all want to see a choice of fascias on our high streets, and not just one or two brands. But at the same time, landlords, like other suppliers, cannot be expected to shore up failing businesses.
However, Hermes, along with many other landlords, has made a commitment to offering tenants the choice of paying rent monthly to help them through tough times and this thinking shows a true willingness to work much more closely with our customers for the future."