Retail round-up on June 14, 2016: Matalan owner says he dropped BHS offer 'on his own', and retail job to suffer due to living wage and Brexit uncertainty.
Matalan founder John Hargreaves says he ‘withdrew’ BHS interest ‘on his own’
Matalan owner John Hargreaves has said that he abandoned his interest in buying collapsed BHS on his ‘own accord’ rather than speculation that he was ‘blocked by Sir Philip Green’.
Hargreaves had teamed up with Turkish entrepreneur Cafer Mahiroglu, the owner of Select Fashions, to build a rescue of BHS after the retailer entered into administration.
However, Hargreaves has said that the pair dropped the offer because of "concerns over the complexity of the issues surrounding the pension deficit - for which we could not gain satisfactory comfort from our advisers".
Jobs in retail likely to slip due to living wage and uncertainty on referendum
Retail job opportunities are anticipated to slide to their lowest level for five years as shops are trying to recover the costs of the government’s new living wage, according to a new Manpower study.
Around a third of retail employers are looking to restrict the amount of new jobs as higher pay package for the lowest-paid workers eat into profit levels and cut dividend payouts.
A survey of 2,100 employers revealed that retailers were the most liklely to recoup the costs of the living wage as they seek to advertise new jobs over the next three months.
Manpower spokesman James Hick said the national living wage, which pays £7.20 an hour to those aged 25 and above, has forced retailers to register the biggest fall in optimism about their hiring intentions since 2011.
He said the uncertainty surrounding the outcome of the EU referendum was also deterring employers from advertising new jobs.
The report found the UK would be “critically short” of workers if EU workers were no longer able to move freely to this country.
Dominic Chappell tried acquiring Austin Reed before BHS fell into administration
Ex-BHS owner Dominic Chappell was attempting to acquire struggling fashion retailer Austin Reed just before the department store chain collapsed, according to the evidence submitted to MPs by Alan Jacobs.
The documents published shows that Chappell held talks about snapping up the menswear retailer; however, the talks fell apart.
The move did not work out as it “became clear that Chappell and Retail Acquisitions [his consortium] did not have resources to sufficient funds to seal such a transaction”.
Dominic Chappell proposed paying a bonus to Retail Acquisitions’ CFO
Two directors of Retail Acquisitions Limited (RAL), which owned BHS until it fell into administration, in April discussed the payment of a £250,000 bonus in spite of the retailer's ongoing cashflow problems.
Dominic Chappell proposed paying RAL’s chief financial officer Aidan Treacy upon completion of a restructuring deal called a company voluntary arrangement (CVA), Sky News reported.
The bonus was initially expected to be awarded by BHS itself but sources familiar with the situation say that Treacy and Darren Topp, the chain's chief executive, then agreed that such a payment was inappropriate.
A person close to Treacy insisted he was then offered the payment by RAL but that he declined to accept it.