Being known as “the other Phil” wasn’t a nickname Philip Day was particularly keen on, but the Mancunian businessman’s habit for swooping on struggling fashion brands has led to lazy comparisons with Sir Philip Green. When the BHS debacle shattered Green’s reputation, Day was anointed “king of the high street”. It infuriated Green, who feigned ignorance of his rival by angrily barking “who?” while Day protested that he was uncomfortable with the moniker and liked a low-profile lifestyle.
Now the pair of former retail tycoons have more in common as they are both living abroad, ruminating on the mess they have made of the British high street. Green watched from his yacht in Monaco as his Arcadia empire was broken up and sold to Asos and Boohoo while Day, who lives in Switzerland, has suffered a swift fall from grace with his empire pushed through various insolvency processes that have left creditors, landlords and employees out of pocket.
The “phoenixing” of Day’s various retail interests in new vehicles fronted by Steve Simpson, his long-term lieutenant, has led to criticism. Last week Peacocks, the last remaining retail asset associated with Day’s Edinburgh Woollen Mill Group, was sold in an insolvency deal to Simpson, financed by Day rolling over his debt and backed by a consortium of Day’s supplier contacts. “At face value it looks like exactly the same set-up as it always was — with Philip owning the business in the background and Steve doing the day-to-day running,” one restructuring expert said
Day grew up on a council estate in Stockport, where his mother worked as a nurse and cleaner and his father worked in a warehouse and did odd jobs. He left school at 16 for a traineeship with Coats Viyella, where he met Debra, his wife. He joined Aquascutum and was promoted to managing director within five years before leaving to join Edinburgh Woollen Mill in 2001, which would mark the start of his dealmaking. Former advisers of Day say that he had been encouraged to buy out Edinburgh Woollen Mill initially because it would be a source of jobs for his friends, family and associates. His daughter Lauren, his son Dan and son-in-law still work for the company.
“It’s not about building a mighty empire, it’s just about the job and doing our best for Britain . . . I prefer to roll my sleeves up and get on with my business away from the spotlight,” he said in a rare interview in 2012.
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Seven years after buying Edinburgh Woollen Mill he added Ponden Mill, a home furnishings business, and Rosebys, a textiles company, after acquiring them out of administration during the credit crunch. He then bought ProQuip, a golfwear brand that is the only retail brand to not have had a brush with insolvency under his ownership. He added Jane Norman in 2011, before buying Peacocks a year later and taking Bonmarché private in 2019.
Day’s appetite seemed insatiable and he was also linked to takeovers of BHS, LK Bennett, House of Fraser, Jack Wills and Warehouse while using his profitable Edinburgh Woollen Mill chain to finance his flutters.
Unlike other high street chains, Day’s empire was not powered by debt. However, the pandemic sounded a death knell as the combination of an elderly customer base, who were staying away from shops, and a woefully small and underinvested online business meant that the lockdowns ravaged its sales.
Day’s blotted track record with Bonmarché, which filed for administration twice in two years and was bought back by vehicles linked to him each time, led to industry experts predicting that his bust empire would end up in his or an associate’s arms once again. They were not wrong. At one stage Day was working with Davidson Kempner, a US hedge fund, to rescue the business. Then another plan was hatched to help bankroll the EWM group’s ecommerce director to front a bid for Peacocks. The passing on of Peacocks and Edinburgh Woollen Mill last week to Simpson has been called a “pre-pack in another name”.
Sources say that while Day had always had the vision for the company, “Steve would be told to go out and get it done”. Simpson has been more than a business associate to Day. He once helped Day’s other daughter, Kirstie, in her attempt to win the Miss England pageant by emailing Edinburgh Woollen Mill staff to demand they register ten votes each.
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With regard to the Peacocks deal, letters from Frasers Group’s law firm, Clarion, have accused FRP Advisory, the administrators to Day’s assets, of “merely going through the motions, wishing to create the appearance of a fair and equal bidding process, when in fact they have a settled intention to compete with one particular party — an insider”. FRP insists it ran a full and fair process and rejects allegations that it had frustrated Frasers Group’s attempts at making a bid.
Another restructuring source said that prospective bidders were negotiating with Day directly and claimed that he had told rivals not to bother bidding because they would not match the price he, as secured creditor, wanted. It is understood that Marks & Spencer clinched a deal to buy Jaeger only after agreeing to deferred payments that would meet Day’s price expectations. “He would only ever do a deal on his terms,” a source said.
A day after Peacocks was bought by Simpson, which supposedly saved 200 shops, he began putting more pressure on landlords, asking them to suspend all rents while it negotiated terms. Simpson said that if they did not like how talks were progressing, landlords could terminate contracts within two weeks. But this could mean landlords having an empty store to fill. In one email seen by The Times and sent last week, Simpson told landlords that store reopenings will “depend in a significant part upon the assistance we receive from you. Administrators have already closed and removed stock from nearly 150 stores and unfortunately inevitably more will follow.”
An FRP report shows Peacocks owed HM Revenue & Customs £8.87 million, stock creditors £22.9 million, landlords £29 million and staff £2 million. Fixed-charge creditors, of which Day was the most significant, were owed £125 million. However, the total worth of the company’s assets was £52.6 million.
While Edinburgh Woollen Mill, Ponden, Peacocks and Bonmarché are reopening some stores this week and their names will remain on the high street, creditors are furious. Mostafiz Uddin, managing director of Denim Expert Ltd, a Bangladeshi supplier, said that he had a £30,000 order with Edinburgh Woollen Mill and had spent $200,000 on raw materials for future orders but this was cancelled.
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“Peacocks still owe us $200,000. They cancelled that order and have never paid me a penny for it,” Uddin said. “Now the company will return — debt-free — after a deal was done. How is this fair? Why can Day write off all his debts and start again? This is not the first time Day has done this. Suppliers should refuse to deal with this company until it pays its pre-existing debts.”
Day’s advisers insist that he is retiring from retail after recuperating from catching Covid-19 last year. It may be just as well, as it seems there is little tolerance left for another merry-go-round of retail brands.
DAY BY DAY: HIS RETAIL BETS
Peacocks
Founded in 1884. Philip Day’s Edinburgh Woollen Mill Group bought Peacocks out of administration in 2012. In November 2020 it was put into administration, putting 423 shops and 4,369 staff at risk. On April 6 this year Day rolled over debt to back a deal with Steve Simpson to save 200 shops and 2,000 jobs.
Bonmarché
Founded in 1982. Day took it private in a £5.7 million deal via his Spectre Holdings vehicle in 2019. In February last year Day’s Peacocks business bought 200 Bonmarché stores out of administration. It was put back into administration in December and sold in January to Purepay Retail, led by Simpson and backed by Day.
Edinburgh Woollen Mill and Ponden Home
Edinburgh Woollen Mill was founded in 1946. Day bought it for £55 million in 2001. It was put into administration with Ponden Home on November 5. He backed a deal on January 12 via Purepay, an Edinburgh Woollen Mill subsidiary, to save 2,500 jobs.
Jaeger
Day bought Jaeger out of administration in 2017 and announced his plan to grow heritage and upmarket brands. In 2018 he planned to open 30 new stores. In November 2020, 76 stores were put in administration. Sold to Marks & Spencer in January as an online-only brand for £5 million.
Austin Reed and Jacques Vert
Austin Reed, founded in 1900, was sold to Day in 2018 as part of Calvetron Brands, after falling into administration for the second time in less than a year. Despite being run as part of the Jaeger stable of brands, the intellectual property rights continue to be owned by Day.
Jane Norman
Founded in 1952. Day bought it out of administration in 2011. It was dissolved in 2018.
Days Department Stores
The first shop opened in October 2017 at former BHS premises in Carmarthen, southwest Wales. Day planned to open more than 50 but in December the only store shut permanently.
