Hours before his attempt to rescue Wilco failed, Robert Manze received an email from Simon Arora.
Arora, a veteran retailer who stepped down as CEO of B&M Bargain Retail last year, wanted to give some «unsolicited advice.»
«I was surprised you were bidding on chains,» Arora told the chairman of Anglo-Canadian private equity firm M2 Capital, before laying out a number of issues he thought Manze hadn't considered.
Arora, the retail heavyweight credited with turning B&M from a struggling northern networks into a nationwide giant with a market capitalization of £5.7 billion, did not understand why Mantse wanted to go into business like Wilko.
Manze, 56, who previously worked for PwC in Russia, made his living primarily in the metals and mining sector, rather than discount retail.
Arora, 53, explained that M2 Capital was likely will face difficulties. buy enough stock from China for this point in the year, especially if he goes to suppliers that Wilko already owes money to before the company went into administration.
«To put it simply, a Chinese garden furniture factory owner won't have time to explain that 'this is a new company,'» said Arora, who declined to comment when contacted by The Telegraph.
Retail heavyweight Simon Arora was puzzled as to why Robert Manze wanted to go into a business like Wilko. Photo: Mark Waugh/Alamy Stock Photo
Mantse was dismayed by the unexpected approach and turned to PwC, which runs the Wilko administration. How did Arora get his email?
Less than 24 hours later, Manze's application was dead. Around 11 a.m. Thursday, the administrators sent an email to Mr. Manza informing him that the negotiations had been completed. Negotiations cannot proceed without any proof of funding, they say.
The rejection of the offer prompted PwC to begin layoffs at Wilko, ending any hopes of the network being fully preserved.
It also marks the latest twist in a saga that has escalated into a bitter fight over M2 Capital's bid in recent days.
Mantse accused PwC of failing to conduct a «fair and transparent» process for the sale of Wilko. PwC dismissed the claims and raised questions about Mantse's source of funds.
Mantse told The Telegraph that he now plans to take legal action against PwC.
When asked what attracted him to Wilko, he replied : “The official answer is 12,500 jobs. The unofficial answer is: we would increase revenue by 100% in two years.”
Wilko, which owns 400 stores, went into administration on 10 August. PwC has asked potential bidders to place their bids at the auction. by the middle of next week, fearing a shortage of cash.
Founded in 1930, Wilko will now start laying off again. coming days Photo: News Scan
However, M2 Capital became a bidder only at the end of last week. The company's interest surprised many observers, given its lack of experience in the sector and its low profile.
Manse offered around £90m to save the entire chain. He claimed to be working with an unnamed billionaire who backed the proposal.
The news of M2's interest was greeted with enthusiasm by the GMB union, which represents about 4,000 Wilko employees.
“It appears from the discussion that they have the necessary capital and the desire to undertake a massive rescue of the company and protect the jobs of our members,” GMB National Secretary Andy Prendergast said in one email, calling the proposal “music to our ears.” '.
The decision comes a day after Canadian HMV owner Doug Putman made another final offer. However, Putman's offer was less generous than that of M2 Capital. The entrepreneur was interested in buying 350 of the 400 stores, although one source close to the process said a bid to buy 200 to 300 stores was under discussion.
Putman's offer is still pending: on Thursday Sky News reported that PwC was consulting with Wilko's creditors about the deal.
However, hopes of an all-out bailout from M2 quickly began to fade as relations between the private equity firm and PwC soured. Just days after stating his interest, Manze, in an open letter, accused PwC of “adding additional criteria to force M2C to withdraw from the tender process.”
Mantse expressed his disappointment at PwC's tight deadlines and said the administrators «create a lot of obstacles and pressure on us.»
Mantse told the Telegraph: «Three minutes before midnight on Friday, we submitted the final proposal.» . And did I have full funding? Of course, yes.
“Then on Saturday they sent us an email saying we needed a funding letter. We need proof of funds. We need bank accounts. We need to know if it's offshore. We need your lawyers to contact us before noon on Monday, a public holiday in the United Kingdom.»
The Telegraph now plans to take legal action against PwC. Photo: YouTube
Reports surfaced that US real estate tycoon Michael Flax was willing to back M2 Capital's bid.
With the company's net worth of around $600m (£473.2m), as well as the man's reputation, who buys and recovers bankrupt companies, support from Flacks of Miami would certainly bolster M2's position.
However, this too has turned into another bone of contention in the bidding. Flax denies any involvement, stating: «Contrary to some reports in the UK media, I have no intention of buying British retailer Wilko and have never expressed any interest.»
«We do not believe that Wilko is representing this long-term opportunity for Flacks Group, and we made it clear last night and today that we foresee a winding down of the business as a result of the development of retail in the UK.”
M2's bid ultimately fell through after PwC did not give the company more time to provide proof of funding, The Telegraph understands.
With the prospect of a full bailout gone, layoffs will begin at Wilko in the coming days.
According to GMB, most employees from IT, finance, legal and human resources departments were invited to a meeting on Friday, where they were told that Monday would be their last day at the company. Cuts in distribution centers will begin next week.
There is still hope that thousands of store jobs could be saved thanks to Putman's proposal, with a statement from PwC expected in a few days.
At the same time, Wilko employees are confused and unsure about their future as the administrative process sometimes threatens to turn into a circus.
A PwC spokesperson said: “We have a fair and transparent policy. sales process and remain focused on our responsibility to provide the best possible outcome for lenders as a whole while retaining as many jobs as possible.”
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