Philip Green NOT On The Brink

You may not have previously heard of the Arcadia Group. But you have now: the retail empire that includes brands like Burton, Topshop and Dorothy Perkins is in a parlous financial state, and may very soon enter administration. As many as 13,000 jobs could be lost, scarring already suffering high streets across the UK.

Philip Green

As the BBC has reported, “Sir Philip Green's retail empire Arcadia, which includes Topshop, Burton and Dorothy Perkins, is understood to be on the brink of collapse. Sir Philip had been in talks with potential lenders about borrowing £30m to help the business through Christmas. However, these talks have failed and administrators could be appointed on Monday, putting 13,000 jobs at risk”. Yes, Philip Green.

Philip Green was “the king of the high street”, yet there was his retail empire about to go belly up. How could that have happened? The Beeb again: “Arcadia admitted that the coronavirus had had ‘a material impact on trading across our businesses’ … However, even before the pandemic, Arcadia's best-known names - like Topshop - were struggling against nimbler online-only fashion retailers like Asos, Boohoo and Pretty Little Thing”.

There was more. "Richard Lim, chief executive at Retail Economics, said that while all clothing shops had been adversely affected by the pandemic, Arcadia's ‘demise has been accelerated because of an online proposition that falls way behind that of their competitors … Years of underinvestment in the digital channel has severely restricted their ability to trade successfully through this hugely difficult period,’ he said”.

And it was Philip Green who bought BHS, took it private, then sold it on for £1. The BBC noted that “Questions were asked following the sale over just how much money Sir Philip had taken out of the company in the years before”, and that “BHS went bust in April 2016, leaving a £571m pensions deficit. Sir Philip agreed a £363m cash settlement with the Pensions Regulator in 2017 to plug the gap in the BHS pension scheme”.

Green's status vis-a-vis Arcadia's employees is explained

Have a think about that: three years ago, Green had no problem ponying up £363 million to pay off the Pensions Regulator. Yet now we are told that he has been in talks with someone else to borrow rather less than 10% of that amount. He will not be putting that money up himself. That, of course, is not illegal or improper.

But consider this from his Wikipedia entry: “For his 50th birthday, Green flew 200 guests in a chartered Airbus A300 to a hotel in Cyprus for a three-day toga party, where they were serenaded by Tom Jones and Rod Stewart, who was reportedly paid £750,000 for a 45-minute set. For his 55th birthday, Green flew 100 guests 8,500 miles in two private jets to The Four Seasons: Landaagiraavaru, an eco-spa on a private island in the Maldives”.

Also, “Green owns a £100 million, 90 m (300 ft) Benetti Lionheart yacht and a £20 million Gulfstream G550 private jet. For a birthday, his wife bought him a solid gold Monopoly set, featuring his own acquisitions … When Green paid his family £1.2 billion in 2005, it was paid for by a loan taken out by Arcadia, cutting Arcadia's corporation tax as interest charges on the loan were offset against profits”.

Now 13,000 people, many not earning significantly more than the minimum wage, face an immediate future without paid employment. But Philip Green will not be one of them.

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