LONDON — The resentment brewing among the former owners of BHS, the British retailer that slipped into administration in April and was wound down last week, bubbled over during a parliamentary hearing on Wednesday.
Dominic Chappell, a twice-bankrupt former race-car driver whose consortium bought the ailing BHS for a pound, or $1.50, last year from Sir Philip Green, said the latter had forced the ailing company to fail.
He told MPs that Green nixed a proposed rescue deal by Mike Ashley, the owner of Sports Direct, who appeared before parliamentarians this week in a separate investigation into allegations that he cheated workers out of salaries, and made them work in “Victorian conditions.”
Although Green sold BHS more than a year ago, he remained its largest creditor and will still have to answer for the hole in its pension fund. Green will appear before the same joint parliamentary committee next week to answer questions related to the failure of BHS and the fund.
Chappell blamed Green for refusing to sell the ailing business to Ashley of Sports Direct. “I went to approach Mike Ashley at Sports Direct before Philip insisted we call the receivers in. There was a willing buyer for the business. We worked with [our lawyers] for 24 hours straight until Philip found out that we were talking to Mike Ashley. He went absolutely insane and served us the notice that tipped us over,” Chappell said.
A spokesman for Green said the retailer was “unaware of any bid by Mike Ashley/Sports Direct.”
Meanwhile, Chappell came under fire from former BHS executives who also gave testimony on Wednesday.
According to the BBC coverage of the hearing, a former BHS financial consultant Michael Hitchcock said: “The credibility and ability of the people Dominic surrounded himself with were not fit for purpose.…I fundamentally don’t think he understood what was going on. I question his intelligence, he wasn’t a retailer.”
The parliamentary investigation is one of five probes under way by bodies including the British government and the pensions regulator.
MPs have already heard from a variety of people including Ian Grabiner, chief executive officer of Green’s Arcadia Group, parent of Topshop and Topman; Paul Budge, Arcadia’s finance director; Gillian Hague, Arcadia’s financial controller, and Chris Harris, the retailer’s property director.
Up to 11,000 jobs will be lost as a result of the BHS collapse. The retailer is also suffering from a 571 million pound, or $822 million, pension deficit.
Parliamentarians are trying to figure out why that sum was so big, and it remains unclear who will have to plug the gap.