Sir Philip Green’s Arcadia Group Files for Bankruptcy

LONDON – Topshop’s troubled parent Arcadia Group, owner of eight retail brands, has filed for bankruptcy in the U.K., the company confirmed late Monday.

Matt Smith and Dan Butters, together with other restructuring partners at Deloitte, have been appointed as joint administrators to the group companies as part of a “trading administration,” Arcadia said.

The group, which operates from about 444 leased sites in the U.K. and 22 overseas, employs about 13,000 people. A total of 9,294 employees are on furlough, and no redundancies are being announced. The stores will open, as usual, once lockdown in England eases on Dec. 2.

The administrators are “assessing all options available to the group and will be honoring all online orders made over the Black Friday weekend and will continue to be operating all the existing sale channels of the business,” Arcadia said.

Ian Grabiner, chief executive officer of Arcadia, said, “This is an incredibly sad day for all of our colleagues as well as our suppliers and our many other stakeholders.

“The impact of the COVID-19 pandemic including the forced closure of our stores for prolonged periods has severely impacted on trading across all of our brands. Throughout this immensely challenging time our priority has been to protect jobs and preserve the financial stability of the group in the hope that we could ride out the pandemic and come out fighting on the other side. Ultimately, however, in the face of the most difficult trading conditions we have ever experienced, the obstacles we encountered were far too severe.

View Gallery

Related Gallery

Black Friday Shoppers in New York City 2020

“Our priority now is to work closely with the administrators to deliver the best possible outcome for all our stakeholders, in particular our hard-working employees across the group. Throughout this process, trading will continue across all of our brands. Our stores will remain open or reopen when permitted under the government COVID-19 restrictions, our online platforms will be fully operational and supplies to all of our partners will continue.”

Smith, of Deloitte, said “Arcadia sits at the heart of the high street, and has been striving to combat the impact of COVID-19 throughout this year. Now the effect of the lockdowns, combined with broader challenges facing bricks and mortar retailers, have resulted in a critical funding requirement for the group and today’s administration.

“We will now work with the existing management team and broader stakeholders to assess all options available for the future of the group’s businesses. It is our intention to continue to trade all of the brands, and we look forward to welcoming customers back into stores when many of them are allowed to reopen.

“We will be rapidly seeking expressions of interest and expect to identify one or more buyers to ensure the future success of the businesses. As administrators we’d like to thank all of the group’s employees, customers and business partners for their support, at what we appreciate is a difficult time.”

As reported, the company had been teetering on the edge of bankruptcy and was expected to call in administrators from Deloitte this week.

The company owned by Sir Philip Green was already in the thick of a restructuring program that had forced it to shutter stores and lay off staff. In June 2019, Arcadia had narrowly avoided bankruptcy after its creditors agreed to back a cost-cutting plan put forward by the retailer.

Online giants, such as Boohoo, and retailers including Mike Ashley, owner of Frasers Group, are expected to be among the bidders for Arcadia’s companies, which include Topshop, Dorothy Perkins and Burton.

Source: Read Full Article