Topshop flagship offered as security for pension payments

By

Barbara Santamaria

Published
Apr 23, 2019

Philip Green has offered to give his 90,000-square-foot Topshop flagship store on London’s Oxford Street as collateral to its pension fund.

The five-storey shop is understood to be worth up to £600 million, reported The Sunday Times.

The move would provide Arcadia some respite as it continues to work on a restructuring plan that could see it pursue a company voluntary agreement.

The retail group behind some of the high street’s top brands including Topshop and Dorothy Perkins is widely expected to seek dozens of store closures and a reduction in annual pension payments from £50 million to £25 million. The company’s pension deficit stood at nearly £750 million last year.

Like many other British fashion companies, Arcadia has found itself struggling in a perfect storm of rising costs, economic uncertainty and the structural shift online.

A source close to the Pensions Regulator told the Sunday Times that the pensions watchdog is trying to avoid accepting a cut given Green’s previous history with BHS, which collapsed in 2016 leading to the loss of 11,000 jobs and a pension deficit of £571 million.

Earlier this month Arcadia appointed two restructuring specialists to its board to help with a company-wide overhaul. Jamie Drummond Smith and Peter Bloxham have joined the boards of Topshop, Arcadia Group and Taveta Investments.