17,000 jobs in peril as Fraser ‘nears collapse’
FEARS were mounting last night over the future of House of Fraser and its 17,500 staff as it teeters on the brink of going bust.
The 169-year-old retailer is struggling to secure a funding lifeline after Sports Direct tycoon Mike Ashley appeared to back away from providing a rescue deal.
Experts have warned that the chain – which started out in 1849 as a small drapery shop in Glasgow – is now on the verge of collapse after a restructuring plan was scuppered last week.
The Chinese owner of Hamleys, C Banner, had promised to provide House of Fraser with £70million in funding if it agreed to close half its 59 stores.
But C Banner walked away over uncertainty surrounding the deal.
Retail consultant Richard Hyman said: ‘You get the feeling that administration is fairly imminent.’
Analyst Nick Bubb said: ‘It will be difficult for management to avoid putting the business into administration soon.’
Mr Ashley, 53, emerged as one of a handful of potential suitors interested in House of Fraser after reports revealed he had offered the retailer £50million in emergency funding. But the retail mogul has cooled on the idea over fears the pensions regulator could get involved, the Sunday Times reported.
Although House of Fraser’s two pension schemes are wellfunded, a takeover would need the approval of the Pensions Regulator and the Pension Protection Fund.
If House of Fraser crashes into administration, it will be the fourth major retailer to collapse this year, joining Toys R Us, Poundworld and Maplin.
As many as 50,000 jobs have been lost from the high street in 2018 as Marks & Spencer, Mothercare and Carpetright are also forced to close stores.
House of Fraser is the UK’s third biggest traditional department store chain. It has a branch in Glasgow, two in Edinburgh and an outlet in Dumbarton, with the Princes Street shop earmarked for closure.
The company declined to comment last night.