Retail Acquisitions planned to write off BHS debt in Sports Direct rescue deal

The retail consortium helmed by Dominic Chappell allegedly planned to waive its £6m debt to BHS as part of a proposed rescue deal with Sports Direct, which reported a 8.4% slump in its full-year profits yesterday.

According to The Guardian, the department store retailer’s former chief executive Darren Topp submitted evidence to MPs as part of the parliamentary inquiry into the collapse of BHS, whose 164-strong store estate will eventually be wound down as a buyer for the retailer wasn’t found.

The documents indicate that Retail Acquisitions would have sold BHS to Sports Direct for £1 in the proposed deal in return for the debt on its £6m loan from BHS being waived.

The retail consortium would have also held a 49% stake in the department store retailer’s international business, which has since been sold to Qatari group Al Mana, while senior management would have remained in their roles and continued to receive salaries from BHS for at least six more months.

Chappell said the terms of the proposed agreement were what “Sports Direct wanted us to sign up for” and that plans to waive the Retail Acquisitions £6m loan had not been included in the final proposed agreement with the sporting goods retailer.

He added that Darren Topp was “nowhere near the negotiations” to sell BHS to Sports Direct and that he has “no idea” where he got the documents that he submitted to MPs from.

Chappell told BBC’s Newsnight earlier this week that BHS’s demise had “absolutely destroyed” his reputation.