GETTY, DAILY MIRROR
The Sunday Times Magazine • 37properly since the controversial £2.2bn
flotation of Sports Direct in 2007.
Green, whose wife had by then amassed
a multibillion-pound offshore fortune from
BHS and Arcadia Group, is said to have
introduced Ashley to key City contacts to
help clear the way for the float. The listing
announced Ashley’s arrival to the big time
and allowed him to take a dividend of
almost £1bn. With characteristic modesty,
he later pronounced that “you struggle to
spend the interest on £1bn”.
“Mike would not have been an important
player to Philip until he had made some
money,” said a retail industry source. “Mike
always made money, but he only became
properly rich when he floated the business.”
The two are described by people who
know them as “frenemies”: their
relationship swings between matey and
fractious depending on their relative
fortunes and the deals they are doing.Right now, they’re matey: Ashley was
one of the guests at Green’s 65th birthday
party at the China Tang restaurant in the
Dorchester on Park Lane in March. But the
relationship was said to have turned
distinctly rocky last year as Ashley tried to
buy BHS from Dominic Chappell, the serial
bankrupt who ran it after Green.
“Mike still talks to Philip, but it’s really a
business relationship these days,” the retail
source said. “They’re sort of friends in need.
Mike won’t fall out with Philip completely
because he knows what Philip’s like.”
Ashley watched with interest as Green,
the arch manipulator of the media, was
finally brought to task by a Sunday Times
investigation into his sale of BHS and a
parliamentary inquiry into the ensuing
pensions scandal.
Having extracted more than £400m of
dividends from the department store in the
early years of his ownership — and
hundreds of millions of pounds more in
rent and service charges — Green sold it for
£1 in March 2015 to Chappell, who had no
retail credentials. Chappell and his Retail
Acquisitions consortium went on to extract
more than £7m before BHS collapsed in
April last year. Its demise revealed a £571m
hole in the company’s pension scheme.
The parliamentary inquiry later showed
that Green had repeatedly refused to plug
the deficit, dismissing a £90m solution in
2014 as too expensive. The tycoon was
hauled before the work and pensions select
committee, where he declared he had “done
nothing wrong”. However, in its excoriating
summary, the committee condemned
Green’s family for the “systematic plunder”
of BHS and its sale to a “manifestly
unsuitable” buyer in Chappell. Almost
nine months after he promised to “sort”
the crisis, and after the Pensions Regulator
threatened to drag him through the courts,
Green agreed to pay up to £363m into
BHS’s pension fund in February this year.
The same week, Green said of the
settlement to The Sunday Times: “I’m not
upbeat, I’m not downbeat — I’m just bored.”
BHS has not been Green’s only problem.
Christmas sales at Topshop, the jewel in
his crown at Arcadia, fell by almost 11%,
and in March this year he was forced to
double his payments into the Arcadia
pension fund to £50m a year to help close
its £565m deficit.
If Ashley was ever tempted to raise a wry
smile as his friend-cum-rival Green was
humbled, the past year has been little better
for Sports Direct. The tracksuits and trainers
retailer dropped out of the FTSE 100 index
as its share price halved amid slowing sales,
falling profits and a misfiring Europeanexpansion plan. Sports Direct took a gamble
on the EU referendum and decided not to
hedge its currency exposure — which came
back to bite it hard, as the company buys
many of its products from Asia in dollars.
The Brexit squeeze has contributed to an
expected decline of almost £120m in
underlying earnings this year.
As the 58% shareholder, Ashley has
felt the pain of Sports Direct’s plunge in
share price more than anyone, although
the majority stake also lets him impose his
will on the City institutions that own the
minority. After investors voted last
September to oust Sports Direct’s hapless
chairman, the former chief constable Keith
Hellawell, Ashley stepped in to save him at
a second, binding vote this January.
The comic apogee of Ashley’s year came
when he opened the doors to Shirebrook,
the Derbyshire warehouse condemned by
MPs for its “appalling” working conditions.
The media open day in September saw
Ashley empty his pockets for a security
check and pull out a thick wad of £50
notes. “Yes, I’ve been to the casino,” he told
reporters. “Now don’t, please, write that.”
Despite their mutual troubles, many in
the industry believe Ashley is a far more
talented retailer than Green, who is now
seen as more of a corporate raider. Ashley,
who has an interest in House of Fraser and
Debenhams, hopes to take Sports Direct
upmarket to attract better products from
brands such as Nike and Adidas.
Green might well reflect on his changed
circumstances. Whereas the likes of Kate
Hudson and Leonardo DiCaprio frolicked
on the beach in Mexico for his 60th, and
Tom Jones and Rod Stewart sang at his 50th,
the famous names he attracted for his 65th
were the TV presenters Vernon Kay and Tess
Daly, and the former footballer Jamie
Redknapp and his wife, Louise. And Ashley.
From parties to high-street retailing, it
seems Green has lost a little of his stardust nThe pair are described
by people who know
them as “frenemies”,
swinging between matey
and fractious depending
on the deals being done
ON THE RACKS Damned by a
government inquiry, Sir Philip Green, left,
had his yacht branded “BHS Destroyer”,
right. Below: Mike Ashley saw the share
price slashed in half at Sports Direct54 £2.16bn £270m ▼
MIKE ASHLEY
Sports equipment and fashionRich List 2017