Sir Philip Green’s appearance before MPs was a rare opportunity to see one of the biggest names in British business being scrutinised.
Green told MPs he was a “big boy” who did not tell lies and did not want to shift the blame for the demise of BHS, which he owned for 15 years until selling it in March 2015 for £1.
His evidence, however, has raised further questions about the collapse of the department store chain, and MPs expressed surprise at the tycoon’s responses to come questions.
Frank Field, the chair of the joint committee, said at one stage: “It is just slightly surprising for me and maybe others, Sir Philip, that everybody who has come has said you are this great figure, a Napoleon figure, and I am slightly shocked in that you are telling us you are not this figure. All these people got it wrong. You didn’t really make all the big decisions.”
Here are five key points from Green’s evidence that MPs are now likely to seek more detail about:
The Sports Direct rescue deal
Green told MPs he was not aware that Sports Direct was interested in buying BHS when Chappell began talks with Ashley on 21 April, but Iain Wright, the chair of the business, innovation and skills committee, produced a letter from Ashley confirming that he had spoken to Green over the following days. This made Green uncomfortable, but he still insisted that he had “zero involvement” in the talks.
It remains unclear why Sports Direct, which was clearly interested in BHS, could not agree a deal and why it was not given enough time to continue talks. Green produced a chequebook for MPs to indicate that Sports Direct was not willing to pay enough for BHS, but the committee was unable to question him further because he accused the MPs of being “really rude” for suggesting his ego might have been a reason for him to block the deal.
The appointment of administrators
Chappell has accused Green of pushing BHS into administration by calling in £35m of debt that Arcadia was owed.
Green brought a letter from the administrators to dispute this allegation and the claim he blocked the Sports Direct deal. His letter from Duff & Phelps said that Neville Kahn, a partner at Deloitte, had contacted the firm first about becoming administrators.
Wright, however, produced a different letter from Duff & Phelps that said Green had contacted them first. “That contradicts what you have just said to us, doesn’t it?” Wright said.
Green and Arcadia, as BHS’s biggest secured creditor, had a legal right to call in administrators, particularly after BHS management told him at a board meeting that its finances were “not fit for purpose”. Green said that Chappell and BHS management had agreed the appointment of administrators, but MPs have heard conflicting accounts of the week before BHS collapsed.
The sale of a BHS shop to Green’s stepson
Brett Palos bought a BHS shop in Ealing for £6.9m just days before Green sold the company to Chappell’s consortium, Retail Acquisitions.
Chappell said he was shocked to find out who had bought the shop and that Green had to inform the pensions regulator that the deal had been done with a related party.
Green, however, told MPs he had no involvement in the deal, a regular response during his six-hour hearing, and did not know whether the pensions regulator had asked him about related party transactions. “Why am I going to lie? It’s sold. It got paid for. It’s ridiculous,” an increasingly agitated Green told the Conservative MP Richard Graham.
The MPs are likely to push for more evidence and documents surrounding the sale of the shop.
Moving to Monaco
Green told MPs he left the UK in 1998 because of a heart scare and “for personal reasons.” He said he did not own “any businesses at all” when they left. Asked why he chose Monaco in particular on health grounds, Green told the committee that “somebody suggested it” and it was partly to do with schools for his children.
The Greens left for Monaco early in 1998, just months before Tina Green collected nearly £38m from the sale of a 13% stake in Sports Division, a retail chain taken over by now-defunct sportswear chain JJB Sports. At the time, Green also owned the Shoe Express chain, which he bought in December 1997. He sold it May 1998 for a £20m profit.
Pausing Project Thor
Green told MPs the main reason he decided to pause discussions on a bailout plan for BHS’s pension fund, known as Project Thor, in September 2014 was that he “felt it was the wrong moment to be going to the suppliers or the landlords” for a contribution. He said he had not been influenced at all by the fact that the pensions regulator had raised the question of “moral hazard”, powers under which it can demand contributions towards a pension deficit from a company’s owner or former owner.
Emails to Chris Martin, the chair of the BHS pension fund trustees, state that the company’s decision to pause Project Thor came after a call with the pension regulator and that this was “clearly a factor”. The regulator had made clear on 4 September that it was looking into moral hazard and wanted more information on dividends paid out by BHS going back to 2000, management charges paid by the company to Green’s parent company, property transactions and rental payments.
Green told MPs he could not remember the exact date when it was decided to pause Project Thor, but MPs said they had evidence to show it was 5 September, the next day.
