Mike Ashley’s Sports Direct has struck a deal to rescue House of Fraser out of administration for £90 million. The department store chain, established in Glasgow, has 59 stores, including 31 already earmarked for closure, and employs 17,500 people.
Sports Direct said in a statement: “The group has acquired all of the UK stores of House of Fraser, the House of Fraser brand and all of the stock in the business.”
Accountancy firm EY was appointed this morning to carry out the administration. Alex Williamson, chief executive of House of Fraser, said: “An acquisition of the 169-year-old retail business will see House of Fraser regain stability, certainty and financial strength.
“In the two weeks since the Cenbest and C Banner transaction ceased, the directors have brought forward a number of potential buyers and the group’s financial advisors have run a comprehensive M&A process to identify and then develop other third party interest that has culminated in the senior secured creditors leading negotiations with parties at a critical pace.”
Sports Direct are now expected to make their own choices about which parts of the business they will retain. The future of the flagship House of Fraser store on Buchananan Street and its head office in Glasgow remains uncertain.