Topshop Owner Arcadia Goes Into Administration
Arcadia - the company which owns clothing outlets such as Topshop, Burton and Dorothy Perkins - has gone into administration.
Sir Philip Green's company has been unable to secure a rescue package, meaning 13,000 jobs are now at risk.
The retail empire has seen sales drop throughout the pandemic and stores across the country could now face closure; however, many of Arcadia's brands are expected to survive in some form.
Administration provides Arcadia with protection from its creditors, which will be able to pursue outstanding debts once administrators have balanced the books. This process typically involves redundancies and closures.
While lockdowns have undoubtedly impacted Arcadia - which also owns brands such as Wallis, Evans and Miss Selfridge - the company had been struggling to compete with online retailers for some time.
Former financial services secretary and chairman of Marks and Spencer, Paul Myners, told the BBC: "Regrettably for everyone involved in Arcadia including, in particular, suppliers and employees the game is up.
"Covid has obviously been a significant factor but the truth is this group of brands has been haemorrhaging now for 15 years. It's become an insignificance.
"Sir Philip never really accepted the opportunity or challenge of online trading. He made no investment in that area at all."
More Like ThisMore Like This
Maria Malone, principal lecturer at the Manchester Fashion Institute, added: "This is the UK's fashion history and heritage going now, Dorothy Perkins and Burtons are 100 years old and Topshop was born out of the swinging 60s.
"It used to be the darling of the High Street and he was the king of the High Street. They have not got the balance right between retail price, quality or production and quality of design."
Sir Philip bought Arcadia in 2002 and his wife, Lady Cristina, is the majority owner of its parent company Taveta Investments.
The couple are said to be worth £930 million ($1,238 million), according to The Sunday Times Rich List.
Sir Philip, 68, was knighted in 2006, but since then there have been numerous calls for him to be stripped of his knighthood, due to allegations relating to tax avoidance, bullying, sexual harassment and racism coming to light last year.
Green's lawyers said at the time he 'categorically and wholly denies' any allegations of unlawful behaviour.
He has come under pressure to cover the shortfall in Arcadia's pension scheme following the move into administration.
The Pension Protection Fund is expected to apply a 10 percent cut to pension pay-outs, with the overall shortfall expected to be in the region of £350 million ($466 million).
Stephen Timms, the chair of parliament's work and pensions select committee, said: "Whatever happens to the group, the Green family must make good the deficit in the Arcadia pension fund."
Featured Image Credit: PA
Chosen for YouChosen for You
Most Read StoriesMost Read