// Arcadia brands in line for £135m revamp, according to a letter sent to staff
// £75m to be spent renovating stores, whole £60m will be used to upgrade online
Sir Philip Green has revealed plans to invest £135 million into Arcadia Group has part of an attempt to rescue his retail empire.
In an email sent to Arcadia’s 18,000 staff, seen by This Is Money, chief executive Ian Grabiner explained £75 million will be spent on renovating its stores, while the remaining £60 million will be used to upgrade its online operations.
Grabiner, one of Green’s longest-serving executives, said the investment would be rolled out over the next three years across Arcadia’s fashion chains.
Improvements include introducing a VIP service and also a new deal with Asos to sell Topshop and Topman clothing on the ecommerce giant’s website in the coming months.
The letter to staff comes a week after Arcadia launched its CVA, which features proposals to shut down 25 stores and axe 520 jobs.
The CVA proposals also include plans to reduce the rent on 194 other stores, while all of the retail group’s 11 Topman and Topshop stores in the US are set to either close down or be sold off.
Another 25 stores under the Evans and Miss Selfridge fascias will shut down as part of separate insolvency proceedings, including the flagship Miss Selfridge store on Oxford Street.
The CVA proposals also include a reduction of contributions to Arcadia’s pension deficit – from £50 million to £25 million.
Green has since offered to provide £185 million in additional funds from property assets to help reduce the pension deficit as part of a bid to win approval for its CVA.
Meanwhile Lady Tina Green – wife of Sir Philip and a major shareholder of Arcadia – is already set to inject £50 million of equity into the business, on top of £50 million she has already loaned, if the CVA is approved.
Arcadia’s pension debt is reportedly around £565 million.