“I was astonished that you are bidding for the chain,” Arora told the chairman of Anglo-Canadian private equity business M2 Capital, before laying out a series of issues he believed Mantse had not considered.
Arora, a retail heavyweight credited with turning B&M from a struggling northern chain into a nationwide giant with a market cap of £5.7bn, was confused as to why Mantse would want to take on a business like Wilko.
56-year-old Mantse, who formerly worked for PwC in Russia, made his living primarily in the metals and mining sector, not discount retail.
“Put simply, a Chinese garden furniture factory owner will not have any time for explanations that ‘this is a new company’,” said Arora, who declined to comment when approached by The Telegraph.
Simon Arora, a retail heavyweight, was confused as to why Robert Mantse would want to take on a business like Wilko - Mark Waugh/Alamy Stock Photo
Mantse was alarmed by the out-of-the-blue approach and turned to PwC, which is running the Wilko administration. How had Arora got hold of his email?
Less than 24 hours later, Mantse’s bid was dead in the water. At around 11am on Thursday morning, administrators emailed Mr Mantse telling him they were done with negotiations. Without any proof of funding, they said, talks could not continue.
The collapse of the bid triggered PwC to begin redundancies at Wilko, ending any hopes that the chain could be saved in its entirety.
It also marked the latest twist in a saga that has in recent days descended into acrimonious infighting centred around M2 Capital’s bid.
Mantse told The Telegraph he now plans to launch legal action against PwC.
Asked what drew him to Wilko, he said: “The official answer is to say 12,500 jobs. The unofficial answer is that we would have grown the revenues by 100pc in two years.”
Wilko, which has 400 stores, fell into administration on August 10. PwC asked would-be bidders to put their offers in by the middle of the next week, fearing a cash crunch.
Founded in 1930, redundancies at Wilko will now begin over the coming days - News Scan
However, M2 Capital only emerged as a last minute bidder at the end of last week. The company’s interest surprised many observers given its lack of track record in the sector and its low profile.
Mantse offered around £90m to save the entire chain. He claimed to be working with an unnamed billionaire who was backing the bid.
News of M2’s interest was met enthusiastically by union GMB, which represents around 4,000 of Wilko’s employees.
“From the discussion it appears that they have the necessary capital and desire to undertake a major rescue of the company and to safeguard our members’ jobs,” GMB national secretary Andy Prendergast said in one email, describing the bid as “music to our ears”.
The approach came a day after another last ditch offer was tabled by the Canadian owner of HMV, Doug Putman. However, Putman’s offer was less generous than M2 Capital. The entrepreneur was interested in buying as many as 350 of the 400 stores, although one source close to the process said a bid for between 200 and 300 of the shops was now being discussed.
Putman’s offer is still on the table, with Sky News reporting on Thursday that PwC was consulting Wilko’s creditors about the deal.
Yet hopes for an all-out rescue by M2 quickly began to fade as relations between the private equity company and PwC soured. Just days after declaring his interest, Mantse accused PwC in an open letter of “adding additional criteria to try to force M2C to not continue in the bidding process”.
Mantse expressed frustration at tight deadlines given by PwC and claimed administrators were “putting a lot of obstacles and pressures on us”.
Mantse told the Telegraph: “Three minutes before midnight on Friday, we submitted a final offer. And did I have full financing in place? Of course I did.
“Then what they did on Saturday was send us things saying we need a financing letter. We need proof of funds. We need the bank accounts. We need to know if it’s offshore. We need your lawyers to contact us before noon on Monday - a statutory holiday in the United Kingdom.”
Robert Mantse has told The Telegraph he now plans to launch legal action against PwC - YouTube
With a net worth said to be around $600m (£473.2m) and a reputation for buying and turning around failing companies, an endorsement by the Miami-based Flacks would certainly have strengthened M2’s hand.
Yet this too turned into yet another bone of contention in the bid. Flacks has denied any involvement, saying: “Contrary to some reports in the UK media, I am not in the running to buy the British retailer Wilko and never expressed any interest.
“We do not believe Wilko represents a long term opportunity for Flacks Group and have made clear last night and today that we foresee the business being wound down as part of the evolving retail landscape in the UK.”
M2’s bid ultimately collapsed after PwC failed to give the company more time to produce proof of financing, the Telegraph understands.
With the prospect of a full rescue vanishing, redundancies will now begin at Wilko over the coming days.
According to GMB, the majority of its staff in IT, finance, legal and HR were invited to a meeting on Friday where they were told Monday would be their last day at the company. Redundancies at distribution centres will begin next week.
There is still a hope that thousands of jobs in stores could be saved by Putman’s bid, with an announcement from PwC expected within days.
In the meantime, Wilko staff have been left confused and uncertain about their future as the administration process has at times threatened to turn into a circus.
A spokesman for PwC said: “We are running a fair and transparent sales process, and remain focused on our duty to secure the best outcome for creditors as a whole, while preserving as many jobs as possible.”
