Sports tycoon Mike Ashley isn't short of cash.
In fact, his Sports Direct firm is worth a whopping £4.3 billion alone. That's not to mention his personal wealth, estimated at £3.75 billion, according to the Sunday Times Rich List.
So his former employees are scratching their heads over the complicated collapse of one of Sports Direct's smaller retail clothing units, West Coast Capital USC, also owned by the Newcastle United magnate.
There are a number of curiosities about USC falling into administration that staff and Scottish MPs have a problem with.
Ashley's Sports Direct bought a majority stake in USC and its 90 stores in 2011, through two holding companies.
However, fashion label Diesel decided to sever its 15 year relationship with USC in 2014, after it obtained a court order to get the store to cough up the cash for the debts it owed Diesel.
Diesel's claim was made on Dec. 15, according to court documents, and after a meeting with USC’s directors led by Sports Direct CEO Dave Forsey on Dec. 23, it was confirmed that the unit would not be able to pay its outstanding debts to Diesel.
Now this is where politicians and staff have become confused.
Ashley’s Republic clothing chain, known as the "premium lifestyle arm" of Ashley's empire, bought USC out of administration.
Administrators Duff & Phelps were forced to accept Republic's offer as Ashley's speedy purchase would mean that most of USC could continue trading.
Politicians are now asking Ashley to appear in front of the Scottish Affairs Committee to answer questions over the complex nature of the collapse, which resulted in the loss of 200-Ayrshire based warehouse jobs and the closure of 28 stores.
Ashley has yet to reply to the formal request but lawmakers are able to summon him to appear should he decline.
Elsewhere, more details have emerged around the alleged breach of workers' rights at USC. Some are looking to take legal action because they were apparently not given the standard 90-day consultation period warning when a worker's job is in jeopardy. According to several reports, workers were given just 15 minutes notice before being let go.
Scotland's Daily Record revealed that Duff & Phelps gave staff a letter on 14th January telling them that their jobs were at risk and that a consultation period had started.
However, the consultation period didn't last very long, as a second letter was sent on the same day, telling the employees that their time at USC had been terminated.
The latest report from the Daily Record shockingly claims that despite the small notice period given to workers, USC knew about its potential to fall into administration two months prior to the axing of staff.
Citing a Duff & Phelps report, the paper claims the firm met a secured creditor of USC on Nov. 14 last year, while a representative of joint administrators the Gallagher Partnership then met USC on Dec. 17.
“It is bizarre and amazing that Duff & Phelps and Gallagher’s were involved at this early stage yet the workers were not told,” says Central Ayrshire MP Brian Donohoe in a press statement.
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