Sir Philip Green, whose role in the demise of BHS was characterised by parliamentarians as the “unacceptable face of capitalism”, came much closer than previously thought to acquiring Marks & Spencer in 2004, a book on the controversial billionaire claims.
The news that the abrasive tycoon almost won the takeover battle for what many considered to be the jewel in the British high street will be regarded as a close escape by some in the retailing industry, many of whom have long bridled at the billionaire’s brusque nature and delighted in his humbling.
At the time of his attempted M&S takeover in 2004, Green was thought of as one of the kings of the British high street, having acquired the loss-making BHS for £200m in 2000 and quickly turning around the business.
BHS was owned by Green for 15 years until he sold it to Dominic Chappell, a former bankrupt, for only £1 in March 2015. It collapsed in April 2016 with the loss of 11,000 jobs and a pension deficit assessed at £571m.
Since then, Green has had to fend off calls for him to be stripped of his knighthood and, following months of pressure, he agreed to hand over £363m in cash to rescue the bust retailer’s pension scheme.
Aside from the M&S near-miss, the book, Damaged Goods, by the Sunday Times business journalist Oliver Shah, also states that:
- The tycoon bullied employees, often making female staff cry, and “delighted in undermining” senior staff. They included Terry Green (no relation), the man he hired to turn around BHS, and Roger Groom, the property director at Sears when Green acquired it, whom he would instruct in the mornings: “Roger, go and make us some tea.”
- One of Green’s American private equity partners expressed concerns over the accuracy of financial statements from Topshop provided for due diligence. Shortly after the concerns were raised in 2012, the firm, Leonard Green, bought a 25% stake for £350m, showing the concerns were assuaged.
- How one of Green’s early mentors included the loan shark Tony Schneider.
Green had first attempted to acquire M&S in 1999 but failed after it was revealed that his wife, Tina, had bought shares in the retail chain before news of the takeover was made public.
On his second unsuccessful attempt in 2004, the book reads: “Green had no idea how close he came to winning. Andrew Grant, the boss of Tulchan, M&S’s PR firm, was horrified to arrive halfway through a crunch board meeting … to find two different press releases waiting – one of them announcing M&S’s surrender. Some members of the board, including [Stuart] Rose’s right-hand man, Charles Wilson, felt it impossible to keep holding out at 400p [the level of Green’s offer per M&S share].
“At that moment, Grant received a call from Kate Rankine, the Daily Telegraph’s deputy City editor. Rose instructed Grant to fob her off by saying there was no change in the board’s stance. Rankine, who was close to both Green and Rose, called Green and relayed the update. The M&S board continued to debate the position fiercely. At 8.30pm, Robert Swannell, one of M&S’s bankers, looked at his BlackBerry and announced: ‘It’s all academic now’ – Green had withdrawn. The message from Rankine seemed to have been the final ingredient that made him lose his nerve.”
Green said he had not seen the book and did not want to comment on it.