• Retail Acquisitions rejected as bidder at least three times
  • Arcadia put in place three protective covenants to prevent funds being taken out of BHS
  • Frank Field: revelations emphasise “the full depth of the extraordinary circumstances of the sale”


Sir Philip Green was reluctant to sell BHS to Retail Acquisitions, documents from the joint select committee inquiry into BHS’s collapse show.

Green repeatedly said he would abandon the deal, owing to the credentials, or lack thereof of three-times bankrupt Dominic Chappell and Retail Acquisitions.

Documents reveal that Goldman Sachs senior banker Anthony Gutman, who had been advising Green since October 2014, was told that Arcadia ““did not want to proceed” with the sale to Retail Acquisitions in December 2014.

Chappell and Retail Acquisitions were rejected again on at least two occasions over the following three months before Green changed his mind and proceeded with the sale in March 2015.

It is unclear what made Green agree to the deal, although Arcadia executives have said Chappell’s ability to deposit £35m in an escrow account at short notice made him more credible.

The funds were provided by Guy and Alexander Dellal, the son and grandson of a property entrepreneur who was an early financial backer of Green.

In addition to scepticism from Green and Arcadia, Retail Acquisitions suffered the loss of its investment bankers River Rock, who resigned as advisers in December 2014.

Select committee chair Frank Field said the revelations emphasised “the full depth of the extraordinary circumstances of the sale of BHS”.

According to the Guardian, documents published today by the committee are understood to show that Green and Arcadia put in place three protective covenants, when agreeing the sale to Retail Acquisitions.

They allegedly run as follows and demonstrate the concerns Green and Arcadia had over money being taken out of BHS.

The first says “all monies in or available to BHS at completion” of the deal, including cash and loans provided by Arcadia Group, “shall be used for the sole purpose of the day-to-day running of [BHS]”.

The second says “all proceeds realised by [BHS] from the sale of the properties shall be retained by [BHS] and used for the sole purpose of the day-to-day running of the business of [BHS]” until a compromise agreement on the company’s pension funds had been agreed.

The third says “no steps are taken by the buyer or [BHS] that would reasonably be expected to adversely affect the ability of [BHS] to continue to operate as a going concern and to pay their debts as they fall due”.