House of Fraser’s future thrown into doubt as investor pulls out

HOUSE OF Fraser’s future is in doubt after C.banner, the Chinese owner of Hamleys, pulled its investment into the troubled retail chain.

C.banner was planning to buy a 51 per cent stake in House of Fraser and plough £70m into the ailing business, but has said it is scrapping the deal because its share price has fallen dramatically.

House of Fraser said in a statement: “House of Fraser is in discussions with alternative investors and is exploring options to obtain the required investment on the same timetable.

“Discussions are ongoing and a further announcement will be made as and when appropriate.”

C.banner’s investment was conditional upon House of Fraser, which employs more than 17,000 people, closing more than half its stores through the socalled Company Voluntary Arrangement (CVA). However, the store closure programme was thrown off course when landlords issued a legal challenge, saying they were unfairly prejudiced by the process.

House of Fraser has previously described the restructuring proposal and investment from C.banner as the last viable option for the business, raising the prospect that it could now fall into administration.

Retail tycoon Mike Ashley, the founder and chief executive of Sports Direct, has reportedly offered House of Fraser a £50m loan in recent weeks. However, it is understood that Mr Ashley is not involved in the current talks with House of Fraser’s management.

Among the House of Fraser stores to shut are branches in Darlington, Doncaster, Grimsby, Hull and Skipton.