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| BHS owner Dominic Chappell moved £1.5m out of troubled retailer | BHS owner Dominic Chappell moved £1.5m out of troubled retailer |
| (about 3 hours later) | |
| Dominic Chappell, the owner of BHS, moved £1.5m from the retailer into an obscure corporate vehicle last week as its financial problems worsened. | Dominic Chappell, the owner of BHS, moved £1.5m from the retailer into an obscure corporate vehicle last week as its financial problems worsened. |
| BHS sources said Chappell transferred the funds to an entity called BHS Sweden, which is not connected to the company, following a board meeting on 18 April, which concluded that BHS needed to find emergency funding or would have to call in administrators. | BHS sources said Chappell transferred the funds to an entity called BHS Sweden, which is not connected to the company, following a board meeting on 18 April, which concluded that BHS needed to find emergency funding or would have to call in administrators. |
| The BHS management are understood to have asked him to return the cash to the business when they discovered what had happened last Wednesday. Chappell then paid back all but £50,000, telling the management that this represented the cost of transferring the money into Swedish krona and back again. | The BHS management are understood to have asked him to return the cash to the business when they discovered what had happened last Wednesday. Chappell then paid back all but £50,000, telling the management that this represented the cost of transferring the money into Swedish krona and back again. |
| Related: Dominic Chappell and the BHS takeover that alarmed retail watchers | Related: Dominic Chappell and the BHS takeover that alarmed retail watchers |
| BHS Sweden is not registered at Companies House or listed as a subsidiary of the retail chain. Sources close to the company said it is controlled by Lennart Henningson, a member of the Retail Acquisitions consortium – 90% owned and led by Chappell – that bought BHS for £1 last year. | BHS Sweden is not registered at Companies House or listed as a subsidiary of the retail chain. Sources close to the company said it is controlled by Lennart Henningson, a member of the Retail Acquisitions consortium – 90% owned and led by Chappell – that bought BHS for £1 last year. |
| When contacted by the Guardian, Chappell said the funds had “remained in the group” and were for “professional fees” . The transaction had taken place after discussions at board level and was “all justifiable”, he added. | When contacted by the Guardian, Chappell said the funds had “remained in the group” and were for “professional fees” . The transaction had taken place after discussions at board level and was “all justifiable”, he added. |
| The development raises further questions about how BHS has been managed by its owners. The retailer called in administrators on Monday, putting almost 11,000 jobs at risk. | The development raises further questions about how BHS has been managed by its owners. The retailer called in administrators on Monday, putting almost 11,000 jobs at risk. |
| Details of the financial manoeuvrings at BHS came as it emerged on Tuesday that the billionaire former BHS owner Sir Philip Green, who sold the company to Retail Acquisitions, will be asked to appear in front of a group of cross-party MPs. He is likely to be questioned about the downfall of the retailer and the impact it might have on the Pension Protection Fund (PPF), which will now have to take over the BHS pension liabilities. | Details of the financial manoeuvrings at BHS came as it emerged on Tuesday that the billionaire former BHS owner Sir Philip Green, who sold the company to Retail Acquisitions, will be asked to appear in front of a group of cross-party MPs. He is likely to be questioned about the downfall of the retailer and the impact it might have on the Pension Protection Fund (PPF), which will now have to take over the BHS pension liabilities. |
| The Guardian has calculated that Green and his family collected £586m in dividends, rental payments and interest on loans during their 15-year ownership of BHS. Over the same period, the group’s pension fund went from a surplus to a deficit of £571m. | The Guardian has calculated that Green and his family collected £586m in dividends, rental payments and interest on loans during their 15-year ownership of BHS. Over the same period, the group’s pension fund went from a surplus to a deficit of £571m. |
| More than £25m was paid from BHS to Retail Acquisitions in the 13 months between the department store’s sale and its collapse into administration. This included £2.8m in management fees, £2.1m in salaries and wages, £11m in legal and professional fees, and £10m in interest payments. | More than £25m was paid from BHS to Retail Acquisitions in the 13 months between the department store’s sale and its collapse into administration. This included £2.8m in management fees, £2.1m in salaries and wages, £11m in legal and professional fees, and £10m in interest payments. |
| Part of the professional fees was an £8.4m loan to Retail Acquisitions, taken out in March 2015, which the Guardian has already reported. About £7m of the £10m of interest payments is understood to have been passed on to investment firm Grovepoint for a loan taken out to support BHS. | Part of the professional fees was an £8.4m loan to Retail Acquisitions, taken out in March 2015, which the Guardian has already reported. About £7m of the £10m of interest payments is understood to have been passed on to investment firm Grovepoint for a loan taken out to support BHS. |
| Chappell has said Retail Acquisition’s fees were benchmarked against the retail industry and paid in accordance with the management services agreement between the company and BHS. | Chappell has said Retail Acquisition’s fees were benchmarked against the retail industry and paid in accordance with the management services agreement between the company and BHS. |
| He is understood to blame the collapse of BHS on Green’s failure to agree a deal with the Pensions Regulator to reduce the size of the company’s deficit. | He is understood to blame the collapse of BHS on Green’s failure to agree a deal with the Pensions Regulator to reduce the size of the company’s deficit. |
| Mike Ashley’s Sports Direct held talks with Chappell over the weekend about buying BHS, but balked at the prospect of taking on the pension scheme. | |
| The work and pensions select committee has confirmed that it will investigate how the BHS pension scheme is likely to affect the state-backed PPF. Frank Field, the chair of the committee, said he planned to call Green to face MPs as part of the investigation. The committee is due to meet on Wednesday to finalise its plans. | The work and pensions select committee has confirmed that it will investigate how the BHS pension scheme is likely to affect the state-backed PPF. Frank Field, the chair of the committee, said he planned to call Green to face MPs as part of the investigation. The committee is due to meet on Wednesday to finalise its plans. |
| Green is also subject to calls to give up his knighthood if he does not pay back dividends received from BHS under his ownership. | Green is also subject to calls to give up his knighthood if he does not pay back dividends received from BHS under his ownership. |
| John Mann, the Labour MP and Treasury select committee member, said: “Sir Philip Green and his family have made millions out of BHS and its hardworking staff. He took over a company with a healthy pension pot, yet when he sold BHS, a black hole had appeared in its fund. | John Mann, the Labour MP and Treasury select committee member, said: “Sir Philip Green and his family have made millions out of BHS and its hardworking staff. He took over a company with a healthy pension pot, yet when he sold BHS, a black hole had appeared in its fund. |
| “Sir Philip Green has taken over £400m out of the company and now must be held responsible for the actions that were taken under his stewardship. | “Sir Philip Green has taken over £400m out of the company and now must be held responsible for the actions that were taken under his stewardship. |
| “There is a very simple and honourable solution to this crisis; repay the dividends, live up to the name he has chosen for his new yacht, ‘Lionheart’, or lose his knighthood.” | “There is a very simple and honourable solution to this crisis; repay the dividends, live up to the name he has chosen for his new yacht, ‘Lionheart’, or lose his knighthood.” |
| Field added: “We need as a committee to look at the Pension Protection Fund and how the receipt of pension liabilities of BHS will impact on the increases in the levy that will now be placed on all other eligible employers to finance the scheme. | Field added: “We need as a committee to look at the Pension Protection Fund and how the receipt of pension liabilities of BHS will impact on the increases in the levy that will now be placed on all other eligible employers to finance the scheme. |
| “We will then need to judge whether the law is strong enough to protect future pensioners’ contracts in occupational schemes.” | “We will then need to judge whether the law is strong enough to protect future pensioners’ contracts in occupational schemes.” |
| There are understood to have been more than 50 expressions of interest in buying BHS since administrators were called in on Monday. The company’s 164 stores are still trading and staff have been told that they will be paid on Friday as planned. | There are understood to have been more than 50 expressions of interest in buying BHS since administrators were called in on Monday. The company’s 164 stores are still trading and staff have been told that they will be paid on Friday as planned. |
| The retailer’s sales surged on Monday after administration was announced. Sales rose by about 80% year on year. | The retailer’s sales surged on Monday after administration was announced. Sales rose by about 80% year on year. |