House of Fraser res­cue deal is now in doubt

Irish Independent - Business Week - - Front Page - Alis­tair Smout

A res­cue deal for Bri­tish re­tailer House of Fraser was thrown into doubt on Wed­nes­day af­ter C.ban­ner can­celled a planned fundrais­ing for its deal to be­come a ma­jor­ity share­holder in the de­part­ment stores.

House of Fraser said talks about al­ter­na­tive sources of in­vest­ment were on­go­ing, and that an up­date would be given when ap­pro­pri­ate.

C.ban­ner, an in­ter­na­tional re­tailer, had agreed in May to buy a 51pc stake in House of Fraser but on Wed­nes­day can­celled a planned share plac­ing to fund the deal and an­nounced a profit warn­ing. “In light of C.ban­ner’s an­nounce­ment... House of Fraser is in dis­cus­sions with al­ter­na­tive in­vestors and is ex­plor­ing op­tions to ob­tain the re­quired in­vest­ment on the same timetable,” the 169-yearold re­tailer said in a state­ment.

C.ban­ner, a ma­jor re­tailer of mid-range to pre­mium footwear brands in China, bought Lon­don toy shop Ham­leys in 2015.

House of Fraser had agreed to close stores as part of the res­cue deal, and in June cred­i­tors ap­proved a re­struc­tur­ing plan which would see 31 of its 59 stores close early next year, with the loss of 6,000 jobs.

A string of UK re­tail­ers have ei­ther gone out of busi­ness or an­nounced plans to close shops in re­cent months as they strug­gle with sub­dued con­sumer spend­ing, ris­ing labour costs, higher prop­erty taxes and grow­ing on­line com­pe­ti­tion. (Reuters)

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