House of Fraser now just 10 days from going under

Four bidders file rescue plans … but chain may still collapse

‘This is a line in the sand for survival’

THE fate of beleaguered department store chain House of Fraser will be decided in ten days – when a major bill falls due.

Four City bidders have filed lastditch rescue plans to save the company, with possible buyers including Sports Direct owner Mike Ashley and billionaire retail tycoon Philip Day.

A decision on their plans is expected within 48 hours. The 169-year-old retailer’s owners are scrambling to find funding before August 20 when concession holders are due to get a multi-million pound payment from the business which it cannot currently afford.

Without a white knight investor, the chain is likely to go bust – putting its 59 stores and 17,500 jobs at risk.

Bosses had hoped to stave off disaster after years of declining sales by closing 31 shops – many dominating high streets – and re-negotiating rents on the remaining ones. But this plan depended on getting a £70million injection from Chinese company C Banner, and earlier this month the rescuer pulled out due to its own financial problems.

It plunged the company into a new crisis and sparked a frantic search for another saviour.

House of Fraser has put out a statement saying discussions with creditors and possible backers are continuing. But industry experts now believe a collapse is increasingly likely. Richard Lim, of consultant Retail Economics, said: ‘House of Fraser is in desperate need of a rescue deal and, without it, it’s inevitable that the business will fall into administration. The deadline they’ve announced puts a line in the sand for when that must be done, but I think it’s going to be incredibly difficult.

‘Department stores are incredibly hard to run and they’re battling against higher minimum wages, increased rents and rising business rates at a time when consumers have changed the way they spend their disposable income.

‘For an investor to come in at this late stage is looking less likely by the day.’

House of Fraser has been owned since 2014 by Chinese billionaire Yuan Yafei.

Bosses are still hoping a rescue can be secured, with possible saviours thought to include Edinburgh Woollen Mill owner Mr Day and Sports Direct. They are seen as the front-runners, although investment firms Alteri and Endless are also understood to have submitted bids.

Accountant PwC, which is advising House of Fraser’s creditors, reportedly told bidders to submit their final offers by yesterday lunchtime.

If no deal emerges then the whole firm will fail, with all staff laid off. But even if a buyer is found, the deal could still involve administration – a legal process which could allow House of Fraser to ditch expensive burdens such as its pension scheme.