Former Arcadia CEO 'pessimistic' Mike Ashley deal will save Topshop empire

29 November 2020, 13:30 | Updated: 29 November 2020, 14:45

The former CEO of retail empire Arcadia has told LBC’s Swarbrick on Sunday he is “pessimistic” about the business’ future, despite plans for an emergency £50 million loan from Mike Ashley.

Sir Philip Green's retail empire Arcadia is preparing to appoint administrators after revealing it is on the brink of collapse, putting 15,000 jobs at risk.

Plans for an emergency multimillion-pound loan to Sir Philip’s struggling Arcadia Group have reportedly been drawn up by Mike Ashley's Frasers Group.

But former CEO of Arcadia Group, Lord Stuart Rose, told LBC he remains “a bit pessimistic” about Arcadia, which includes major high street brands Topshop, Dorothy Perkins and Burton.

“If anyone can pick up bits and parts of this business and save some jobs I am all for that, but I am a bit pessimistic I will admit,” he told Tom.

Read more: Sir Philip Green's TopShop empire Arcadia Group 'at risk of collapse'

Lord Rose, who is now chairman of Ocado, added: “What you are seeing is what happens in retail all the time - I have been involved in retail for forty odd years - you get constant change.”

However the shift to online shopping, accelerated by coronavirus has led to a “perfect storm” for businesses, Lord Rose explained.

“Those businesses that haven’t invested, those businesses that are not relevant anymore, those businesses that are exclusively bricks and mortar are the ones that are suffering. And Arcadia is one of those.”

The group has more than 500 retail stores across the UK with the majority of these currently shut as a result of England's second national lockdown, which will end next week.

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Earlier this year, Arcadia revealed plans to cut around 500 of its 2,500 head office jobs amid a restructure in the face of the coronavirus crisis.

Pressed by Tom, Lord Rose refused to comment on Sir Philip’s management of the business, saying: “I have had my fights with him, let’s put it that way.”

Sir Phillip has recently faced criticism for planning a Christmas holiday to an exclusive Indian Ocean resort in the Maldives, where some villas cost £30,000 a night.

In 2005, Arcadia paid a record £1.2billion to Green’s wife Lady Tina, 71, in Monaco.

Read more: Government launches 'business task force' to help firms prepare for Brexit

Arcadia is the latest retailer to have been hammered by the closure of stores in the face of coronavirus, with rivals including Debenhams, Edinburgh Woollen Mill Group and Oasis Warehouse all sliding into insolvency since the pandemic struck in March.

Lord Rose told LBC the government had “over promised and under delivered consistently” in dealing with the pandemic.

“We have had nothing rhetoric. We have had a whole pile of rhetoric about moonshots, we have had a whole pile of rhetoric about how we are going to swat this virus out of the way.

“We always should have understood that it was going to take a long time to get the right side of it.”

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He added: “We should have also had the debate in public, openly about on the one hand you can have this, ie. save all the lives, on the other hand you can keep some part of the economy going, but you can’t have both.

“It doesn’t need to be binary, we could have some choices and I think we have made some bad choices.”