BHS rescue bid fails: Bombshell for 11,000 staff
BHS is set to vanish from the high street with all 11,000 jobs at risk after a potential rescue deal fell apart
The business will be wound down and all BHS's 163 shops will close and be sold off to other retailers. Administrator Duff & Phelps said that 8,000 permanent jobs are likely to be lost and another 3,000 not directly employed by BHS are also at risk.
The news comes after last-ditch rescue bids from former Mothercare boss Greg Tufnell and Mike Ashley's Sports Direct failed.
Duff & Phelps said: "Although multiple offers were received, none were able to complete a deal due to the working capital required to secure the future of the company."
Administrators were understood to be thrashing out terms for a takeover by a consortium led by Gregg Tufnell, a former Mothercare boss and the brother of ex-England cricketer Phil Tufnell.
The consortium, which includes banker Nick de Scossa and Jose Maria Soares Bento, registered a new firm called Richess Group Limited at Companies House earlier this month. The group was thought to have secured financing for the deal from wealthy Portuguese backers.
However, hopes have now been dashed.
BHS, which has branches across the North East including Sunderland, South Shields and Hartlepool, collapsed in April, leaving behind a Â£571million pensions black hole and sparking an investigation by MPs into its demise.
MPs are set to quiz billionaire Sir Philip Green, who owned BHS for 15 years, and Dominic Chappell, the man he sold it to for Â£1, in the coming weeks.
Both men have been roundly criticised, Sir Philip for paying a Â£400 million dividend to his family from the business and over his management of the pension scheme, and Mr Chappell for sucking management fees out of BHS before its collapse.
Shopworkers’ trade union Usdaw has urged administrators to look after the best interests of staff, after they announced the shock liquidation of BHS, and poses serious questions for the Government on the future of the high street.
Dave Gill – Usdaw National Officer says: “The staff in BHS have been in a state of anxiety and uncertainty for over a year after the company was sold for one pound, went into administration and has now been put in liquidation. This news is a devastating blow for the staff and the shock waves will be felt on high streets throughout the country. There are some very serious questions that need to be answered, by former owners of the business, about how a company with decades of history and experience in retail has now come to this very sorry end.
“We believe the Government has also got to take a hard look at the process of administration. Currently the law requires administrators to liquidate a company if they believe that secures the best return for creditors, regardless of whether there is an option to keep the business going and secure jobs. Now that decision has been made for BHS, we urge the administrators to comply with the law on consultation and not force the staff to seek a protective award which can result in taxpayers picking up the bill.
“There are wider concerns the Government needs to address about the future of the high street as we see yet another major player go to the wall. Very real concerns need addressing about the impact of business rates, high property rents and the much higher tax liabilities high street retailers they have over online retailers.
“In the meantime we are providing the support and advice our members in BHS require at this very difficult time.”