The former owner of major retailer Wilko has denied that “greed drove the company into bankruptcy”, leading to its collapse and the loss of more than 12,000 jobs.
Lisa Wilkinson said the reason it collapsed earlier this year was because the retailer ran out of money. The loan deal was struck with Australian bank Macquarie, which kept Wilko afloat during Liz Truss’s disastrous mini-budget, causing interest rates to soar and making the vital loan unviable.
She rejected accusations from lawmakers that she took millions of dollars from the company in dividends or ignored advice from management consultants who could have saved the company if she had acted sooner.
Ms Wilkinson, a third-generation owner of the family business founded by her grandfather 92 years ago, apologized to the thousands of people who lost their jobs when the retailer collapsed.
“I’m devastated that we let all these people down with the Wilko bankruptcy,” she said. I don’t know how to express how sad I am that we have let down all of our team members, all of our clients, our suppliers and our consultants.”
She appeared before the House of Commons Business and Commerce Committee, which is investigating the collapse of Wilko.
When challenged by Liam Byrne, the committee’s chairman, Ms Wilkinson said: “You can use the word ‘sorry’, of course I’m sorry… I’m sorry we don’t support these people anymore.”
Wilko employees were extremely loyal and felt like “extended family,” the committee said. Ms Wilkinson said she still considered them family but added that she believed she was “no longer involved”.
She said, “This is a wonderful group of people.”
Wilco’s board of directors and administration dissuaded her from apologizing after the collapse, and she admitted that the only press interview she gave after that was with… Sunday TimesMany Wilko employees probably wouldn’t read this.
Ms Wilkinson disputed Mr Byrne’s claim that her “greed drove the company into bankruptcy” and that she had “swept into a failing company” by paying millions of dollars in dividends to herself and other family shareholders while the company was in insolvency and financial crisis. was approaching.
She said she did not accept claims that the family had paid themselves £150 million in dividends over the past 20 years. She said funds contributed to the family trust before 2014 were used to buy out family members who no longer wanted to be shareholders.
Since then, dividends agreed and paid by independent directors have averaged £1.7 million per year. During that time, the company had cash reserves of £77 million a year, had no debt and paid out £36.5 million into its pension scheme, she said.
The Wilkinson family are not “one of the richest families in Britain”, she stressed, adding that they do not have the assets to pay their £50 million staff pension deficit.
Ms Wilkinson argued that Wilko’s collapse was due to a combination of internal and external factors, including increased competition from discount rivals and large supermarkets, the general decline of UK high streets, high rents and long-term leases, high business rates, etc. etc., as well as the pandemic. .
She admitted Wilko had also failed to develop a better online shopping website, improve quality and range of products, and made costly mistakes in upgrading its distribution warehouses in Nottinghamshire and Wales.
Nadine Oughton of the GMB union told MPs the union did not believe Wilko’s collapse was inevitable, but rather that it had been brought to its knees by “weak leadership and Wilko’s failure to adapt to a changing market”.
A high turnover of management, including the absence of a CEO for eight years, as well as a failure to reinvest profits back into the company, led to its collapse.
The union says Lisa Wilkinson bears “significant responsibility” for the flooding.
Union members said Ms Wilkinson had different ideas about how Wilko should operate, which were more similar to those of John Lewis than to the old Wilkinson chain of stores, which the company was well versed in.
She pointed to the opening of a Wilko store in Kensington High Street, one of Britain’s wealthiest areas, and said: “If that’s not a vanity project, I’m not sure what is.”
Patrick O’Brien, retail expert at GlobalData, said retail had been thriving until the last decade and long before the pandemic, when the retail sector began to change.
He said they were facing increased competition including B&M and Dunelm, as well as from larger supermarket chains who had begun to offer a wider range to their customers. “Wilco was attacked from all sides,” he added.
The company also suffered from being largely located on high streets and unable to open stores outside the city, and its stores faced expensive rents and long-term leases, leaving them cash-strapped.
Liam Byrne said the committee had collected evidence showing that “supervisors didn’t bark, the insolvency office turned pensioners into second-class citizens and directors appeared to ignore advice on how to save their own companies, and as a result now We have taxpayers.” ” “On the line.” They face redundancies of more than £40 million, a pension fund shortfall of £50 million and a payout to shareholders of around 4p in the pound.”
Kevin Hollinrake, the business minister, told MPs that no evidence of director misconduct had been found in the Wilco case, but said the cases were still being investigated.
Source: I News
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