Sir Philip Green vs Select committee

[sidicks]

CoolHands said:

He bought BHS for 200 million, took 580 million out, and sold it for £1. He just knows how to play clever games, not sure why anyone would defend him or think that the way he behaves is ok.

Who has defended him? People have just corrected those who claimed he was doing something illegal.

CoolHands said:

Just because he didn't break any law doesn't make it ok. Was it alright that comedians played legal games to avoid paying tax before they were all caught out? Most people would say no.

Poor analogy - judges subsequently ruled that what they did was illegal, didn't they?

Edited by sidicks on Thursday 18th August 13:37

[turbobloke]

CoolHands said:

He bought BHS for 200 million, took 580 million out, and sold it for £1. He just knows how to play clever games, not sure why anyone would defend him or think that the way he behaves is ok. Just because he didn't break any law doesn't make it ok. Was it alright that comedians played legal games to avoid paying tax before they were all caught out? Most people would say no.

With respect, most people don't have a clue and take their steer from SJW noise on social media.

Not breaking the law makes it OK, not doing anything immoral makes it OK, as pointed out already companies do go under and it's not automatically a case of cherchez le chat gros. Or graisse, even.

[CoolHands]

sidicks said:

CoolHands said:

Just because he didn't break any law doesn't make it ok. Was it alright that comedians played legal games to avoid paying tax before they were all caught out? Most people would say no.

Poor analogy - judges subsequently ruled that what they did was illegal, didn't they?

Edited by sidicks on Thursday 18th August 13:37

I'm not sure - it looks like they (jimmy carr) voluntarily stopped using the scheme

http://www.bbc.co.uk/news/uk-politics-18531008

in that article (2012) it also mentions Green and his cushy set-up

bbc said:

Retail magnate Sir Philip has firmly denied avoiding hundreds of millions of pounds in tax by transferring ownership of his Arcadia business, saying that Arcadia was bought by his wife, Lady Green, in 2002 and because she has not lived in the UK for 15 years no tax was due on any dividends that were paid to her.

[kiethton]

Davey S2 said:

kiethton said:

People need to realise that in a free market companies do fail, even those which employ 11k people, especially if they are no longer offering what the market needs. Phillip Green has himself done nothing wrong at all, legally or morally.

So why did he not invest heavily in the company to change it's offering instead of siphoning everything he could to his leathery old wife in Monaco?

I'm sure such a brilliant businessman and retail guru like him would have had no trouble doing that and he could then have sold the company for billions with a clear conscience rather then flog it for £1 to someone he knew was basically a clueless fall guy.

Green's just a greasy wide boy done well (financially anyway)

Because no amount of investment would fix that sinking ship - amongst others their offer was dated and the leases on the stores were often onerous

He only paid himself the dividends at a time when the company was doing well as people were spending money they didn't have on credit on crap prior to the GFC, at a time when debt was cheap (we all remember base + 0.2% or 120% LTV mortgages?). At this time the business was sustainable and the dividends were perfectly fine, causing the business no harm what so ever.

As conditions worsened it continued trading although far worse as it didn't react to the market trends, fast fashion, online etc. and was saddled with numerous expensive high street stores, at high rents when more people wanted to go to shopping centres/online/Asos etc.

At this stage turnaround plans were actioned, no dividends were taken and the pension ran at a surplus.

It is the current financial markets that have caused the pension liability issues, try matching a guaranteed liability with a negative yielding bond...

This is borne in the FTSE 100 - there was a net pension surplus at the beginning of the year, now a significant deficit owing to cuts in interest rates, tightening of bond yields and our old friend Brexit....

ETA - Similar scenario, you set up a used car garage, it trades well and you earn a decent amount of money. You pay yourself a basic salary and top-up with dividends for tax efficiency. Over time trade turns down as less people want your £1-5K petrol barges, they now want diesel fiesta's on finance. You are making ends meet so you carry on paying your own salary but stop paying dividends. 9 years later your losing money hand over fist as now nobody wants your £1-5k petrol barges and you still haven't started selling diesel fiesta's on finance so you decide to close your business. Do you repay the dividends you took from the company 10 years ago when all was going well?

Edited by kiethton on Thursday 18th August 14:02

[crankedup]

Pity the owner didn't off load BHS years ago, a new owner may have had halve a chance to turn the business around.

[sidicks]

CoolHands said:

sidicks said:

CoolHands said:

Just because he didn't break any law doesn't make it ok. Was it alright that comedians played legal games to avoid paying tax before they were all caught out? Most people would say no.

Poor analogy - judges subsequently ruled that what they did was illegal, didn't they?

Edited by sidicks on Thursday 18th August 13:37

I'm not sure - it looks like they (jimmy carr) voluntarily stopped using the scheme

http://www.bbc.co.uk/news/uk-politics-18531008

in that article (2012) it also mentions Green and his cushy set-up

bbc said:

Retail magnate Sir Philip has firmly denied avoiding hundreds of millions of pounds in tax by transferring ownership of his Arcadia business, saying that Arcadia was bought by his wife, Lady Green, in 2002 and because she has not lived in the UK for 15 years no tax was due on any dividends that were paid to her.

"Cushy set up' equals transferring assets to a spouse, in exactly the same way as anyone else can do?

[avinalarf]

Talking hypothetically about a Mr Black.
It appears he has done nothing illegal in law.
So we are talking moral responsibility,and I have taken to much flak on PH to go down that path.
So what's the point of this debate ?

[CoolHands]

My only point in this debate is I'm perfectly happy to see him lose his rag when challenged by a reporter. The reporter apparently has more guts than the Work and Pensions committee.

[crankedup]

Paddy_N_Murphy said:

crankedup said:

Pity the owner didn't off load BHS years ago, a new owner may have had halve a chance to turn the business around.

Because Retail, on the High Street, is such an awesome business to be in right now ?

Yeah, someone who doesn't sport a fat tan and budgie smugglers would have made a much better job of it .......... than the man who does understand retail.

But I thought that we had so many brilliant CEO and business people that a least one of them would have had a look. After all BHS had so much wrong apparently waiting to be fixed. Did Green just give up on it. Besides which BHS was doing OK years back, did he not foresee the drop, such is his brilliance

[crankedup]

Jockman said:

Derek Smith said:

I put money into a pension from the age of 16 to 28. It was taken by my bosses. Taken. They told us it would be put into a fund that was untouchable by them but, we discovered, that was a lie. My union took them to court and we were told there was no law broken.

Sorry to hear that, Derek.

I believe the law has now been changed so that this cannot happen again?

I expect thousands of people had their pension payments stolen, I know that one of my brothers had the misfortune to have this happen to him. Business that stole his money used it to open the next business in different name.

[sidicks]

crankedup said:

I expect thousands of people had their pension payments stolen, I know that one of my brothers had the misfortune to have this happen to him. Business that stole his money used it to open the next business in different name.

Just because something is illegal does not stop it happening!

[walm]

crankedup said:

But I thought that we had so many brilliant CEO and business people that a least one of them would have had a look. After all BHS had so much wrong apparently waiting to be fixed. Did Green just give up on it. Besides which BHS was doing OK years back, did he not foresee the drop, such is his brilliance

Plenty did have a look.
Mike Ashley for example.
BHS did have so much wrong but the question isn't whether it was "waiting to be fixed" or whether it was so fundamentally broken that it was unfixable by anyone!
He may well have foreseen the drop and that's why he sold it for £1!!!!!

There is no doubt that he has run some excellent businesses.

Just because a business has existed or still exists doesn't mean it SHOULD!!

Examples:
HMV
Jessops
Comet
Focus
MFI

etc... etc...

High street retail is probably the toughest business out there at the moment.

[sidicks]

walm said:

Plenty did have a look.
Mike Ashley for example.
BHS did have so much wrong but the question isn't whether it was "waiting to be fixed" or whether it was so fundamentally broken that it was unfixable by anyone!
He may well have foreseen the drop and that's why he sold it for £1!!!!!

There is no doubt that he has run some excellent businesses.

Just because a business has existed or still exists doesn't mean it SHOULD!!

Examples:
HMV
Jessops
Comet
Focus
MFI

etc... etc...

High street retail is probably the toughest business out there at the moment.

One of the signs of a good CEO is to know when to stop throwing good money after bad!

[Countdown]

Paddy_N_Murphy said:

Businessman bought business, could not turn it profitable, still took out £500m in dividends, it failed, he managed to offload it to another shyster in the vain hope of avoiding fallout from the st hitting the fan, and left behind a massive unfunded pension debt : shocker.

FTFY

[anonymous-user]

kiethton said:

Because no amount of investment would fix that sinking ship - amongst others their offer was dated and the leases on the stores were often onerous

Were the onerous and expensive leases owned/transferred to his wife's 'company'?

[sidicks]

Countdown said:

Paddy_N_Murphy said:

Businessman bought business, could not turn it profitable, still took out £500m in dividends, it failed, he managed to offload it to another shyster in the vain hope of avoiding fallout from the st hitting the fan, and left behind a massive unfunded pension debt : shocker.

FTFY

Dividends were paid from profits, Pension fund deficit was caused by falling interest rates.

HTH

[avinalarf]

walm said:

crankedup said:

But I thought that we had so many brilliant CEO and business people that a least one of them would have had a look. After all BHS had so much wrong apparently waiting to be fixed. Did Green just give up on it. Besides which BHS was doing OK years back, did he not foresee the drop, such is his brilliance

Plenty did have a look.
Mike Ashley for example.
BHS did have so much wrong but the question isn't whether it was "waiting to be fixed" or whether it was so fundamentally broken that it was unfixable by anyone!
He may well have foreseen the drop and that's why he sold it for £1!!!!!

There is no doubt that he has run some excellent businesses.

Just because a business has existed or still exists doesn't mean it SHOULD!!

Examples:
HMV
Jessops
Comet
Focus
MFI

etc... etc...

High street retail is probably the toughest business out there at the moment.

He,he .....Green and Ashley .....fat ugly,bds.....
Sidicks......is it still legal to be fat and ugly......just checking.
Re. Mr Black.....
Anyway.......not so subtle difference between crap management and a management that cynically manipulates events by asset stripping a company,in every conceivable legal way,so as to leave it in a perilous and irrecoverable position.
Yes ....it's the same misfortune and outcome for the employees but a very slightly less bitter pill to swallow.

[kiethton]

speedyguy said:

kiethton said:

Because no amount of investment would fix that sinking ship - amongst others their offer was dated and the leases on the stores were often onerous

Were the onerous and expensive leases owned/transferred to his wife's 'company'?

No and neither were the freeholds - they were purchased first refusal at market value...funds going to the BHS group

[walm]

avinalarf said:

Anyway.......not so subtle difference between crap management and a management that cynically manipulates events by asset stripping a company,in every conceivable legal way,so as to leave it in a perilous and irrecoverable position.

I genuinely don't know but I would be surprised if SPG did anything like traditional asset stripping.
I thought the BHS he bought was pretty similar to the BHS he sold, wasn't it?
(Except for the rather obvious point that it was facing unbeatable competition from Amazon, ASOS, Primark, H&M and Inditex.)

[avinalarf]

kiethton said:

speedyguy said:

kiethton said:

Because no amount of investment would fix that sinking ship - amongst others their offer was dated and the leases on the stores were often onerous

Were the onerous and expensive leases owned/transferred to his wife's 'company'?

No and neither were the freeholds - they were purchased first refusal at market value...funds going to the BHS group

Keithon...you're a market analyst......respect for that.
Green may be many things.....but he is not stupid.
I am a life long retailer.
Of the many events changing the retail scene,over the past ten years,acknowledged by everybody in the industry,especially in clothing but also in most other products,two have been game changing.
1) The purchasing of products through the Internet.
2) The shrinkage of the " middle market " in pricing.
Neither were addressed by Green vis a vis BHS.
A person might therefore ask........why was that ?