£ 50million ‘provocation’: Sports Direct chief Mike Ashley accused of playing games over extraordinary loan offer to save Philip Green’s Arcadia
- Sir Philip’s Arcadia group set to call directors tomorrow morning
- This jeopardizes the future of 500 Arcadia stores and 13,000 jobs
- Sports Direct and House of Fraser owner Mr. Ashley have offered an ‘emergency loan‘
Billionaire sportswear mogul Mike Ashley has made an extraordinary £ 50million loan offer to save Sir Philip Green’s TopShop empire from collapse.
Sir Philip’s Arcadia group, which is owned by his wife Tina, is expected to call on administrators tomorrow morning, jeopardizing the future of 500 stores and 13,000 jobs.
But in a dramatic intervention yesterday, Mr Ashley, owner of Sports Direct and House of Fraser, offered an “emergency loan” to move Arcadia through to Christmas.
However, his offer was angrily rejected as a “publicity stunt” by sources close to Sir Philip.
One said: “Sir Philip doesn’t feel like jumping in bed with a Chancellor like Mike Ashley.”
Sir Philip’s Arcadia group is expected to call administrators tomorrow morning, putting the future of up to 500 stores and 13,000 jobs at risk (Sir Philip Green, pictured)
Monaco resident Sir Philip and Mr Ashley – known as ‘Masher’ in his inner circle – are old friends, but the tension between the two has grown as their rivalry escalates.
The loan offer from a big retail rival has been called ‘provocative’ by city sources and is likely to anger Sir Philip, a flamboyant businessman once referred to as’ king from the main street ”.
Friends said last night Sir Philip and his family were “deeply saddened” by Arcadia’s disappearance and one of them said the loan offer was rejected as nothing more than Mr Ashley ” having a little fun “.
Sir Philip, whose clothing empire also includes Dorothy Perkins, Burton and other brands, has suffered a dramatic drop in reputation since BHS sold serial bankrupt Dominic Chappell for just £ 1 in 2015. BHS did. bankruptcy a year later.
Like other retailers, Arcadia suffered a devastating blow by the November lockdown, missing a crucial trade in the run-up to Christmas, and Sir Philip has spent the past few weeks unsuccessfully trying to secure a $ 30million loan. pounds sterling to keep the business afloat. .
The £ 50million announced by Mr Ashley yesterday would be conditional on Arcadia guaranteeing the money against business assets such as its properties.
But in a dramatic intervention yesterday, Sports Direct and House of Fraser owner Mike Ashley (pictured) offered an ’emergency loan’ to move Arcadia forward until Christmas
But city sources said it made the loan ‘impractical’ – and could even unintentionally give Mr Ashley control of the entire fashion group in the unlikely event that it did happen.
One of them said Mr Ashley appeared to be “playing games” by offering the loan. “You might as well serve Arcadia and all of its companies on a plate to Mike Ashley,” said an insolvency expert.
Arcadia’s pension scheme is said to have a deficit of £ 350million. Lady Green is expected to inject £ 50million to revitalize the company and its retirement fund.
Part of the remaining shortfall could be secured by ownership of Arcadia, such as its huge TopShop store on Oxford Street in London.
But with the decline in the value of the real estate portfolio during the pandemic, it has become increasingly difficult for Arcadia to obtain loans from its bankers.
Mr Ashley has previously made a similar offer to the ailing Debenhams department store business.
Mr Ashley’s CFO spoke publicly yesterday via Sky News to make the offer to Sir Philip, who he said needed one of his directors “to contact us today to discuss how we can support them and help save as many jobs as possible ”.
But as The Mail on Sunday went to press last night, no discussion appeared to have taken place and the company still looked set to collapse early next week.
Arcadia is expected to trade until Christmas and limited layoffs are expected in stores before January.
Mr Ashley, who also owns Newcastle Football Club, is expected to be among the bidders for the group’s brands if the company is dismantled and sold in the new year.
Sources in the city named Marks & Spencer, Next and Boohoo as other potential bidders.
The Mail on Sunday also understands that Mr Ashley has separately expressed interest in purchasing the massive Trafford Center shopping center in Manchester as he seeks to expand his empire.
Arcadia, who declined to comment last night, said in a statement Friday: “Our stores will reopen in England and Ireland as soon as government Covid-19 restrictions are lifted next week.”