Video report by ITV News Business Editor Joel Hills
Sir Philip Green’s Arcadia retail empire - which contains high street names including Topshop, Dorothy Perkins and Burton - has fallen into administration with 13,000 jobs at risk, administrators have confirmed.
The group, which runs 444 stores in the UK and 22 overseas, said 9,294 employees are currently on furlough.
A statement from administrators Deloitte said no redundancies will be announced today as a result of the appointment and stores will continue to trade.
The firm said online orders made over the Black Friday weekend will be honoured and will "continue to be operating all the existing sale channels of the business".
Ian Grabiner, chief executive of Arcadia, said: “This is an incredibly sad day for all of our colleagues as well as our suppliers and our many other stakeholders.” He added: “Our stores will remain open or reopen when permitted under the Government Covid-19 restrictions, our online platforms will be fully operational and supplies to all of our partners will continue.”
Matt Smith, joint administrator at Deloitte, said: “We will now work with the existing management team and broader stakeholders to assess all options available for the future of the group’s businesses.
“It is our intention to continue to trade all of the brands, and we look forward to welcoming customers back into stores when many of them are allowed to reopen.
“We will be rapidly seeking expressions of interest and expect to identify one or more buyers to ensure the future success of the businesses.
“As administrators we’d like to thank all of the group’s employees, customers and business partners for their support, at what we appreciate is a difficult time.”
Business Secretary Alok Sharma said he would be keeping a “very close eye” on the administrators’ report on director conduct, and pledged the Government would support the affected workers.
He tweeted: “Within three months, the administrators have a duty to file a report on director conduct with The Insolvency Service – who will then determine whether a full investigation is required. I will be keeping a very close eye on this process.”
Mr Sharma added: “This is a deeply challenging time for retailers and we remain fully committed to supporting them, including through an unprecedented package of business support worth £280 billion.”
Retail trade union Usdaw said it will seek an urgent meeting with Arcadia’s administrators in an attempt to save jobs and ensure staff are treated fairly.
Usdaw national officer Dave Gill said: “Now that Arcadia is in administration it is crucial that the voice of staff is heard over the future of the business and that is best done through their trade union.
“We are seeking urgent meetings and need assurances on what efforts are being made to save jobs, the plan for stores to continue trading and the funding of the pension scheme. In the meantime we are providing our members with the support and advice they need at this very difficult time.
Earlier on Monday, Mike Ashley’s Frasers Group said an offer for a £50 million lifeline for Arcadia was rejected.
It came as MPs called on Sir Philip to cover a shortfall in the pension scheme and urged the pension watchdog to fight on behalf of the group’s workers. Stephen Timms, chairman of the Work and Pensions Committee, called on the tycoon to stump up funds to fill the pensions black hole, which is estimated to be as large as £350 million. It is the latest retailer to have been hammered by store closures during the coronavirus pandemic. Rivals including Debenhams, Edinburgh Woollen Mill Group and Oasis Warehouse have all slid into insolvency since lockdown measures were first imposed in March. Earlier this year, the group revealed plans to cut around 500 of its 2,500 head office jobs amid a restructure in the face of the coronavirus crisis. Frasers Group, which runs Sports Direct, told the London Stock Exchange earlier on Monday that a £50 million loan aimed at keeping Arcadia afloat had been rejected. The company said: “Frasers Group can confirm that Arcadia Group Limited have declined Frasers Group’s offer of a lifeline loan of up to £50 million. “Frasers Group were not given any reasons for the rejection, nor did Frasers Group have any engagement from Arcadia before the loan was declined.”
Labour leader Sir Keir Starmer tweeted: "This is awful news for thousands of Arcadia employees just before Christmas. Phillip Green should do the right thing and fill the Arcadia pension deficit."
Adam French, Which? consumer rights expert, said: "Topshop and other Arcadia brands collapsing into administration is yet another serious blow for the high street in what has been a torrid year for retail. "We would advise any consumers who have vouchers to think about spending them as soon as they can. "If there is something you are planning to buy from Topshop or other affected brands that is worth more than #100, make sure you use a credit card as you'll be able to make a claim against your credit card company to recover the money if anything goes wrong."