Sir Phil’s empire back from brink in 11th-hour rescue
SIR Philip Green’s retail empire has narrowly avoided falling into administration after its landlords agreed to a last-ditch rescue package.
The deal will pave the way for store closures which will put around 1,000 jobs at risk. However, it means a more secure future for most of the chain’s 18,000 staff and its 9,000 pension fund members.
Plans to save Sir Philip’s Arcadia Group, which owns brands such as Topshop and Miss Selfridge, were approved at a knife-edge meeting in London yesterday.
It means the group will shut around 50 of its 566 stores and will receive rent reductions on hundreds more as it desperately tries to slash costs and get the business back on track.
Last night Sir Philip, 67, thanked everyone who supported the proposals including landlords, suppliers and the pensions regulator. He said: ‘Our suppliers have been beyond wonderful. They stood loyal and didn’t waver. Obviously I feel happy for all the staff and everyone associated with the business.
‘I and the board and my family are wonderfully appreciative of all the people who voted positively to help get this through.
‘It shows they have faith in us and now we have to deliver.’
Sir Philip faced a major battle in winning support, needing the approval of 75 per cent of voters including landlords, suppliers and pension trustees. He also needed the approval of the pensions regulators.
Sir Philip was forced to postpone the rescue meeting last week after reaching a stalemate with landlords, some of whom opposed his plans, which involve accepting big cuts in the rent Arcadia pays.
Sir Philip and his wife Tina, who is Arcadia’s ultimate owner, had to offer more than £300million in cash contributions and security to safeguard 9,000 members of the retirement scheme before The Pensions Regulator agreed to sign off the plan.
However, last night critics sought further assurances that Arcadia’s pension fund would not suffer the same fate as that of BHS. The department store collapsed with a £571million pension black hole in 2016, a year after Green sold it for £1. He later plugged the scheme with £363million from his own fortune.
Frank Field, an independent MP and chairman of the Commons’ work and pensions committee, called on Sir Philip and Lady Green to make a binding promise that Arcadia’s pensioners will get their full pensions. He said: ‘The committee will try to ensure that the Pensions Regulator gets an effective programme in place to ensure that Arcadia staff receive in full the pensions that Sir Philip and Lady Green promised them.’
Sir Philip has seen his reputation suffer in recent years. He is currently at his home in Monaco as he tries to fight off assault charges in the US.
Arcadia’s reprieve comes as it and other High Street chains battle with crippling business rates.
John Webber, head of business rates at property firm Colliers, said: ‘Unless something is done, Arcadia won’t be the end of this story.’