Sir Philip Green to sell BHS?

Apr 14 2008

Billionaire retailer Sir Philip Green is rumoured to be looking to sell his department store chain Bhs so that he can concentrate on Top Shop, it was reported today.

Sir Philip is understood to be looking for buyers for the chain so that he can focus on expanding Top Shop and its clothing range designed by supermodel Kate Moss in the United States, according to the Independent on Sunday.

The range is already selling through New York store Barneys, and the first American Top Shop is due to open in October.

Sir Philip is thought to have spoken to a number of people about taking on the chain, but has run into problems as no one wants to take on 180 stores at a time when retailers are suffering from a slowdown in consumer sending.

A retail source described as being close to Sir Philip, told the Independent on Sunday that Primark was interested in some of the town centre sites, while Marks & Spencer would like to acquire around 20 stores.

Supermarket giant Tesco is also rumoured to be keen to acquire some of the retailer’s space.

But Sir Philip is understood to be “loath” to break up the chain.

Bhs is likely to suffer along with other retailers this year as consumers tighten their belts as their incomes become increasingly stretched in the face of rising food and fuel costs.

Sir Philip warned at a retail conference in Barcelona last week that the chain would make lower operating profits this year compared with the year to March 2007, when it reported operating profits of £52.7 million - significantly down on the £114 million it made in 2005.

Top Shop currently has 300 shops in the UK and 97 overseas. It is part of Sir Philip’s Arcadia Group, which is the UK’s largest privately owned clothing retailer with more than 2,500 outlets, including brands such as Burton, Dorothy Perkins, Evans, Miss Selfridge and Wallis.

Bhs was bought by Sir Philip in 2000 for £200 million. It has around 180 stores in the UK, as well as outlets in Russia and the Middle East.

It is currently expanding into Eastern Europe, and recently announced plans to open stores in India.

Neither Sir Philip nor spokespeople from Bhs or Arcadia could be contacted to comment.