Green buys jewellery chain debt
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Your support makes all the difference.Philip Green, flamboyant former chairman of the What Everyone Wants discount clothing chain, staged a City comeback of sorts yesterday when he acquired the bank debt of Owen & Robinson, the troubled jewellery and footwear retailer whose shares were suspended last Friday.
Together with partner Stephen Kay, Mr Green has bought the group's pounds 6m bank debt at a discounted rate from TSB, the company's banker. He has also acquired the TSB's 15.6 per cent stake in the parent company. The fast-talking entrepreneur is now in effect the company's banker and it must dance to his tune. As one observer noted: "He's got them over a barrel."
Asked why he was interested in a beleaguered high street group which reported an pounds 8m loss in April, Mr Green said: "I don't really know yet. There are about 18 different options. I'm waiting for the board to show me some proposals for the way forward. I have no say in the running of the company. I'm just wearing two hats - banker and shareholder."
Mr Green is conducting the deal on his own account which keeps the business separate from the Owen Owen group of department stores he acquired in December 1994.
Owen & Robinson's shares were suspended at 16p after it said the closure of its loss-making chain of 59 jewellery shops was costing more than expected. The group had announced in April that it was pulling out of jewellery retailing at a cost of nearly pounds 5m.
A big drain on the company is expensive leases on the jewellery shops costing pounds 1m a year. It is expected that the jewellery business will be put into receivership or liquidation. This would strengthen the group's hand in negotiations with shop landlords and leave Foothold as a stand- alone business.
Foothold reported profits of pounds 544,000 last year. The original 15 stores reported like-for-like sales of 8 per cent and a further 38 shops were acquired last October. "It needs some work but the jewellery side has been dragging it down," Mr Green said.
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