Daily Mirror (Northern Ireland)
Departed store
6,000 jobs at risk as Fraser plans 31 shop closures to avoid total collapse Is Fraser doomed?
ALEX WILLIAMSON HOUSE OF FRASER BOSS ON THE CLOSURES
mass job losses, failing one of the biggest employers and industrial sectors in the UK, which is why Labour has called on the Business Secretary to publish a retail sector strategy to safeguard jobs.
“The next Labour government will support retail by placing it at the heart of our industrial strategy.
“It’s time for the Tories to step up to the challenge of rescuing high streets.”
House of Fraser, majority owned by Chinese investors, is following many of those stores already in trouble by using a Company Voluntary Arrangement in a bid to shut branches and save the ailing business.
Not only will the 31 stores close by early next year but owners will be asked to take a 70% rent cut as part of a planned rescue package. The rent on another 11 of the remaining 28 stores would be cut by 25%, saving £20million.
House of Fraser also plans to shuts its head offices in Central London and Glasgow. All 2,000 staff jobs at the HQ and stores will go.
Around 4,000 concessions workers also face an uncertain future.
The closures are being demanded by a new investor in exchange for pumping £70million of vital funds into the business. Chinese firm C.banner, which owns toy shop chain Hamleys, plans to buy 51% of the business.
However, the chain needs 75% of its creditors, including store landlords, to back the plan.
If it fails, the whole of the business and the 59 stores could collapse.
House of Fraser boss Alex Williamson acknowledged the “brutality” of the cuts but insisted it was only way to save the business and hopefully the remaining jobs.
He added: “The decisions to close this number of stores is not taken lightly. It was really grim.
“It is a highly emotional, highly regrettable situation that none of us either imagined or wanted to see happen, but there is simply no alternative.” Chairman Frank Slevin said: “Our legacy store estate has created an unsustainable cost base, which without restructuring, presents an existential threat to the business.”
The threat of collapse to House of Fraser came just a day after Amazon announced plans to hire another 2,500 staff in Britain.
There has been a big shift from high street to internet shopping which has hastened the demise of many stores.
House of Fraser is not the only high street giant suffering losses.
Profits at Debenhams fell 84.6% to £13.5million in the six months to March. The John Lewis Partnership, which also includes Waitrose, suffered a dive of 67% to £178million in the year to the end of January.