Tuesday, 23 October, 2018

Sports Direct's Mike Ashley to acquire House of Fraser for £90mn

Mike Ashley Director of Sports Direct Mike Ashley Director of Sports Direct
Nellie Chapman | 12 August, 2018, 16:13

Sports Direct said it would buy troubled department store chain House of Fraser for £90m from its administrators, while keeping "as many stores open as possible".

Around 17,000 staff were told they would be transferring to Sports Direct as the businessman declared his aim to make House of Fraser the "Harrods of the high street", keeping as numerous 59 stores as possible open.

House of Fraser which was controlled by Chinese conglomerate Sanpower prior to the Sports Direct buyout announced its intention to enter administration.

Department stores have been having a hard time recently, with other big names such as Debenhams and Next also struggling, both reporting a large fall in profits earlier this year.

Opened in Liverpool 1856, Lewis's was a much loved department store and its flagship home store served as the location of the world's first Christmas grotto in 1879, entitled "Christmas Fairyland".

House of Fraser opened at Rushden Lakes almost a year ago on August 24.

House of Fraser at Fremlin Walk Maidstone.

Some 17,000 staff have been informed that they will be transferred over from House of Fraser to Sports Direct.

The billionaire has also built up stakes in rivals such as Debenhams, Goals Soccer Centres and French Connection.

So what will this mean for House of Fraser staff - and shoppers?

We'll keep you updated when we have more information.

Sports Direct would not comment on store closures or how many of House of Fraser's 16,000 jobs will be lost.

Details of Mr Ashley's plans for HoF, including how numerous 17,500 people who work for the company and its concession operators will keep their jobs, are unclear.

"We are hopeful that the current negotiations will shortly be concluded".

House of Fraser chairman Frank Slevin said: "This has been an extraordinarily challenging six months in which the business has delivered so many critical elements of the turnaround plan".

House of Fraser's £175 million of floating-rate notes due September 2020 were quoted at a bid price of 20 pence on the pound, according to BNP Paribas prices on Bloomberg. The advantages brought by the warehouses and logistics already managed by this group will be an important key in the recovery of the House of Fraser's fortunes.

The move came after discussions between investors and creditors failed to offer a "solvent solution".