House of Fraser appoints administrators

House of Fraser appoints administrators

Mike Ashley, who also has a large stake in luxury fashion business Flannels, swooped in to secure the buyout just hours after the company, which owns the prestigious Jenners store on Princes Street, announced it was going into administration yesterday morning.

"This is a massive step forward and further enhances our strategy", he added.

"My ambition is to transform House of Fraser into the Harrods of the High Street".

"Court hearings are expected to take place at 7.30 am today, at which orders will be sought appointing individuals from Ernst & Young LLP as administrators of each of the operating companies with immediate effect".

Ashley's Sports Direct International Plc agreed to acquire all of the 169-year-old retailer's United Kingdom stores, as well as the brand name and inventory, it said in a statement.

This precipitated a three-way tussle between retail billionaires Ashley and Philip Day as well as a proposal by Alteri Investors, with Ashley ultimately emerging on top.

"I'm hopeful that both House of Fraser and Jenners will stay open, but we need to be looking at all of the shops too".

However, accountancy giant EY, which was overseeing the process, opted for Mr Ashley's offer.

Mr Wilson called the possibility of a merger between the troubled department store chains a "viable solution" to reduce overheads.

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The billionaire has held an 11% stake in the business since 2014 and also owns nearly 30% of Debenhams, its main rival.

House of Fraser, which employs 17,500 people and has 59 stores across the country, previously announced it had entered administration after talks between investors and creditors broke down.

Mr Ashley was one of at least four parties squaring off to rescue House of Fraser after China's C.banner International Holdings Ltd shelved plans to buy a majority stake.

Prior to the latest crisis, House of Fraser had recently agreed a so-called Company Voluntary Arrangement (CVA) with landlords to close half of stores, with 6,000 jobs in the firing line.

Last month Sports Direct booked a charge of 85 million pounds for its disastrous investment in Debenhams - a rival department store group to House of Fraser.

The company saw its business rates bills rise £3.99 million to £30.24 million this year following a Government revaluation, according to research group Altus.

The Unite union said despite a media storm over the treatment of staff at Sports Direct's Shirebrook warehouse, wages remained at a minimum and employment conditions were "threadbare". "Turning around the business will not come easy".

Another first was that it was the retailer's first sustainable and green store.

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