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Goldman Sachs told Arcadia about BHS buyer's bankruptcies | |
(about 1 hour later) | |
A Goldman Sachs banker told a key executive from Sir Philip Green's company about the risks of selling BHS to Dominic Chappell, MPs heard. | |
The MPs are examining the role that BHS directors and advisers played before the retailer was sold for £1 last year. | |
Anthony Gutman said he told Sir Philip's Arcadia Group about Mr Chappell's history of bankruptcy and lack of retail experience. | |
However, the bank did not rule out a deal with Mr Chappell, he said. | |
Mr Gutman, co-head of Goldman Sachs' European investment banking services, told MPs he gave the "observations" to Paul Budge, Arcadia's finance director, four months before the sale. | |
Goldman Sachs was not a formal adviser on the deal because it was "too small" for the investment bank to handle, he said. | |
The joint session of the Commons Business and Work and Pensions select committees will hear later from Mr Budge and other senior Arcadia executives. | |
'Concerned' | |
Earlier, the MPs heard that advisers at accountancy firm KPMG also raised concerns with Arcadia about Retail Acquisitions, the acquisition vehicle led by Mr Chappell. | |
David Clarke, a partner at KPMG, told MPs: "We were particularly concerned about its ability to continue to trade and fund both BHS - which was clearly loss-making - and the [pension] schemes." | David Clarke, a partner at KPMG, told MPs: "We were particularly concerned about its ability to continue to trade and fund both BHS - which was clearly loss-making - and the [pension] schemes." |
KPMG, which was an adviser to the embattled BHS pension schemes, sent their concerns to the retailer and its other advisers ahead of the sale, Mr Clarke said. | KPMG, which was an adviser to the embattled BHS pension schemes, sent their concerns to the retailer and its other advisers ahead of the sale, Mr Clarke said. |
Business Live - MPs grill BHS directors and advisers | Business Live - MPs grill BHS directors and advisers |
BHS entered administration earlier this year, putting 11,000 jobs at risk and leaving a £571m pensions deficit. | BHS entered administration earlier this year, putting 11,000 jobs at risk and leaving a £571m pensions deficit. |
Other advisers from accountancy firms Deloitte and PwC, and law firm Eversheds, said they had not raised concerns about Retail Acquisitions. | Other advisers from accountancy firms Deloitte and PwC, and law firm Eversheds, said they had not raised concerns about Retail Acquisitions. |
The MPs heard that BHS management decided to pause a pension rescue plan, known as Project Thor, in 2014 to let managers focus on trading. | |
The rescue plan was then shelved in February 2015 as the possibility of a BHS sale emerged, the committee heard. | The rescue plan was then shelved in February 2015 as the possibility of a BHS sale emerged, the committee heard. |
That revelation takes some pressure off the Pensions Regulator, which had faced questions about why it did not allow Project Thor to go ahead. | That revelation takes some pressure off the Pensions Regulator, which had faced questions about why it did not allow Project Thor to go ahead. |