Mike Ashley's Frasers Group draws up £50m loan plan for Arcadia

Plans for an emergency multimillion-pound loan to Sir Philip Green’s struggling Arcadia Group have reportedly been drawn up by Mike Ashley’s Frasers Group.

It comes just a day after Sir Philip’s retail empire was revealed to be on the brink of collapse with around 15,000 jobs at risk.

Arcadia Group, which runs the Topshop, Topman, Miss Selfridge, Dorothy Perkins, Wallis, Evans and Burton brands, is expected to appoint Deloitte as administrators in the coming days.

The offer from Frasers Group, which runs Sports Direct, House of Fraser, Flannels and Jack Wills, amounts to £50m likely to be in the form of a secured loan, Sky News reported.

The broadcaster quoted Chris Wootton, Frasers’ chief financial officer, as saying: “We hope that Sir Philip Green and the Arcadia Group will contact us today to discuss how we can support them and help save as many jobs as possible.”

However it is understood that there has been no formal approach to Arcadia.

Arcadia had been in emergency talks with lenders in a bid to secure a £30m loan to help shore up its finances, but these talks had broken down. The company said it was still assessing its options with Deloitte, but the accountancy firms is primed to take over as administrator.

If the insolvency is confirmed, it is expected to trigger a scramble among creditors to get control of company assets.

Arcadia is the latest retailer to have been hammered by the closure of stores in the face of coronavirus, with others including Debenhams, Edinburgh Woollen Mill Group and Oasis Warehouse all sliding into insolvency since the pandemic struck in March.

The latter two brands were bought from liquidators by Boohoo, who turned them into online-only entities, which some believe may be the outcome for some of the Arcadia brands.

Arcadia has more than 500 retail stores across the UK with the majority of these currently shut as a result of England’s second national lockdown, which will end next week. In spite of the current issues, the stores are expected to reopen when England lifts its lockdown.

Earlier this year, Arcadia revealed plans to cut around 500 of its 2,500 head office jobs amid a restructure in the face of the coronavirus crisis.

Read further analysis on this story below:

Arcadia’s Sir Philip Green: the ups and downs of one of retail’s biggest names

Arcadia: what went wrong and what's next?