Arcadia Group Shares Worth GBP 3bn

Shares in Arcadia, the clothing stores group bought by Philip Green two years ago for GBP850m, are now valued at more than GBP3bn according to a filing made yesterday at Companies House and reported by the Guardian newspaper. The annual accounts for Arcadia Ltd, formerly Arcadia Group plc until the company was taken private following Green's acquisition in October 2002, reveal that shares in the trading companies were valued at GBP3,019,803,000 at August 30 last year.

Arcadia Ltd has taken advantage of Companies Act rules which allow it not to disclose all of its group undertakings. However, the accounts list a number of direct and indirect holdings in its principal subsidiaries, including Burton Retail, Dorothy Perkins Retail, Evans Ltd, Miss Selfridge Retail Ltd, Top Shop/Top Man Ltd, Wallis Retail Ltd, and the Redcastle property business.

A note to the accounts states: "In the opinion of the directors the aggregate value of the company's investments in its group undertakings is not less than the amount at which they are stated." The headline figure for the investment in trading companies is significantly higher than the value for Arcadia as a whole because the carrying amount in the balance sheet must be offset against amounts owed by the subsidiaries to their parent.

The note dealing with amounts due to Arcadia Ltd from its subsidiary companies is incomplete, making it impossible to establish exactly how much is owed. The balance sheet does show an amount of £2.2bn described as creditors falling due after more than one year. Arcadia Ltd also provides administrative and logistical services to its subsidiaries. Management charges levied on subsidiaries during the year generated revenue of GBP114.5m out of a company total turnover of GBP315.2m.