Revealed: Barclay brothers give up dividend from Shop Direct

The Barclay brothers have had to overhaul the refinancing of their retail empire, giving up a possible £200 million pay cheque, the Evening Standard can reveal.

Sir David and Sir Frederick Barclay were poised to launch a £700 million bond issue last week at Shop Direct, which owns websites such as very.co.uk and littlewoods.com. They were hoping to reap dividends as high as £200 million, but sources say the brothers had to drop the substantial payout, labelled “a little aggressive” by the City, to see the deal through.

The bond issue will be launched today to raise £550 million. Bankers from Barclays are leading the deal.

The twins, who also own the Telegraph newspapers and the Ritz hotel, put Shop Direct up for sale earlier this year, with three buyout funds fighting out an auction. They called it off, however, after the private equity firms reportedly refused to meet their £3 billion price.

The company, Britain’s second largest online retailer after Amazon, posted annual sales of nearly £2 billion. Revenues have been boosted by offering access to hundreds of brands, including Victoria Beckham and Vivienne Westwood, to consumers typically using credit.

A spokesperson for Shop Direct declined to comment.