The end for BHS, administrators to wind group down
loading...
Business
London - The axe has dropped for British department store group British Home Stores as administrators announce the orderly wind down of the BHS business, which is set to result in the loss of 11,000 jobs.
In spite of the "considerable efforts" of the appointed administrators Philip Duffy and Benjamin Wiles, Managing Directors of Duff & Phelps, they were unable to find suitable buyer and agree on a sale of the business. Multiple offers for the collapsed department store group had been made, according to the joint administrators, however no deal was completed due to the working capital needed to secure the future of the company.
BHS to wind down with the loss of 11,000 jobs
"Our thoughts today are with the employees. We thank them for their professionalism and hard work," said Duff & Phelps in a statement. "We would also like to thank the great British public for helping us in our efforts to save BHS resulting in several weeks of significant sales."
All 163 stores are set to be closed down over the next coming weeks, as administrators will continue to seek potential buyers to take over store leases. The jobs of 8,000 members of staff are likely to go, with a further 3,000 roles of none BHS employees working in store also placed at risk, following the liquidation of the 88 year old retailer.
"The British high street is changing and in these turbulent times for retailers, BHS has fallen as another victim of the seismic shifts we are seeing," said Philip Duffy, Managing Director of Duff & Phelps and Joint Administrator in a statement. "The tireless work and goodwill of the existing management team and employees of BHS with the support of my team were not enough to change the fortunes of the company."
Employees are believed to have been informed of the impending liquidation of BHS assets at 2pm today. Up until this morning hopes for a sale were still high, as talks of a bid from the consortium back by Greg Tufnell, former Mothercare head, and a last-minute bid from Sports Direct founder, billionaire Mike Ashely were mentioned.
However Ashley is understood to have pulled out of the running and the consortium backed by Tufnell, known as Richess Group, appears to have lacked sufficient funding to convince administrators it could secure the future of BHS. The orderly wind down of BHS is set to take place immediately, . with employees at BHS's head office in London likely first in line to be made redundant.
BHS fell into administration on April 25, a day before high street retailer Austin Reed collapsed into administration, and with a pension deficit valued at 571 million pounds. A parliamentary inquiry into the collapse of BHS and its pension deficit has been launched, and is being led by Iain Wright MP and Frank Field MP, chairmen of the Business and Works and Pensions committees in the House of Commons.
Sir Philip Green, former owner of BHS, is set to give evidence in front of the joint committees on June 15. He held the department store group for 15 years, until he sold it for the token sum of 1 pound to Retail Acquisition last year, a collective of accountants and lawyers led by Dominic Chappell. The group received millions of pound of loans and payments from BHS during its 13 month ownership before filing for administration.