‘Business as usual’ as House of Fraser sold
HOUSE of Fraser bosses say it’s ‘business as usual’ after it was announced the department chain is to be sold by its Chinese owners.
Sanpower-owned Nanjing Xinjiekou Department Store is selling a majority 51 per cent stake in House of Fraser owners of iconic Deansgate store Kendals - to Chinese tourism group Wuji Wenhua.
It comes after recent trading troubles at House of Fraser and amid a dismal start to 2018 for UK retail, with Toys R Us and Maplin both collapsing into administration in February.
A House of Fraser spokesman said it was ‘business as usual’ at the chain in the UK, adding that the move was ‘just a change of ownership.’
Sanpower bought House of Fraser in 2014, but the deal has since proved illfated for the Chinese giant, with UK trading under pressure and little success in its plans to launch department stores worldwide.
House of Fraser reported a 2.9 per cent fall in sales in the crucial six weeks to December 23, while online sales fell 7.5pc after hiccups with the launch of a new web platform.
The chain was forced to ask for rent cuts on some of its stores in early January, while also overhauling its supplier base as part of moves to cut costs.
At the time of the Christmas trading update, Sanpower chairman Yuan Yafei said the Chinese group was ‘fully committed to its long-term investment in the UK retail market.’
He added Sanpower would continue to provide ‘all the necessary support to ensure House of Fraser’s success as the leading UK premium department store chain.’
The group had planned to expand the chain internationally, with 50 House of Frasers planned across China under the name Oriental Fraser.
But it has only opened one House of Fraser in China - a store in Nanjing in late 2016. Other minority shareholders in House of Fraser include Sports Direct founder Mike Ashley.
Nanjing would retain a 38pc shareholding in House of Fraser if the deal goes ahead.
It said it was still in talks with Wuji Wenhua, but added the firm would be a ‘strong strategic equity partner as they possess vast experience in the leisure sector and have access to a large network of travellers.’
“This additional partnership will help House of Fraser to further internationalise its brand to reach out to an increasingly large international consumer base,” it added.
Despite being owned by House of Fraser since 1959, the Deansgate store is known to most Mancs as Kendals – after its original owners Kendal, Milne and Co.
The ‘Kendal, Milne and Co’ name is still clearly visible on marble fascias above the store’s entrances.