The dark ages: some rescue
On the Today programme on BBC Radio 4 on Monday, 24 August 2009, Focus DIY Chief Executive Bill Grimsey (or Bill Grimsby, as he was introduced) told interviewer Tanya Beckett that he had “rescued” the Iceland Group in 2001.Click here to read a full transcript of the interview.
Bill Grimsey was Chief Executive of Iceland Group (later renamed The Big Food Group) from January 2001 to February 2005, by which time the business was on the verge of collapse. A more realistic view of the achievements of those years can be found in The Dark Ages section of The Iceland Story on this website. See also the table of Accounting Provisions created in 2001 which plunged the business into loss but were subsequently found to be “not needed” and used to support profits until 2004, and the recurrent claims of imminent but undelivered recovery in The one, two, three, four, five year recovery plan.
Finally, for a more realistic perspective on this “rescue”, see the chart of Iceland’s Operating Profit since 1981 and note the contrast between the results achieved during The Dark Ages and those both before and after.
In his comment column in the Daily Mail on Tuesday, 25 August, City Editor Alex Brummer also took a rather different view:
So Bill Grimsey sees himself as a rescuer of companies.
As the Focus DIY chief executive prepared for a meeting with creditors of Focus DIY at which he persuaded them to back a company voluntary arrangement (CVA), Grimsey gleefully told radio listeners that he 'saved the Iceland group in 2001'.
Is this the same Iceland that, under Grimsey's leadership, renamed itself Big Food Group and subsequently saw sales fall off a cliff?
Could it have been the same Iceland that decided that one route to recovery was to curtail the company's final salary pension scheme?
Was this the company that eventually tumbled, frail and exhausted, into the hands of a consortium headed by the Icelandic retail group Baugur? Indeed it is.
And if Grimsey thinks that pushing through a CVA for Focus is the same as 'rescuing' it, then he has a different definition of the word
Let's be clear: with a CVA, creditors lose out. It is an admission of mistakes made and a way of trying to escape the full consequences of past actions.