Eagle Radio

www.964eagle.co.uk

: Waiting for next track...

Breaking News

Pedestrians injured after crash outside Parliament
Visit the 1st Place Skip Hire website
Visit the 1st Place Skip Hire website

Britelite Windows

Eagle Radio News

Contact the News Team:
Tel: 01483 300 964

Surrey staff at risk as House of Fraser calls in administrators

camberley house of fraser

8:55am 10th August 2018
(Updated 9:43am 10th August 2018)

The Sports Direct tycoon is on the brink of buying House of Fraser - after it announced it had called in administrators.

  • Mike Ashley is close to an agreement to buy the failing department store.

  • The Camberley and Epsom stores are already due to close.

  • Now Guildford hangs in the balance.

At the moment, the move by HoF puts 17-thousand jobs at risk - including at its three stores in Surrey, in Camberley, Guildford and Epsom.

It comes after last ditch rescue talks to save the struggling business failed.

But now, a Sky News exclusive says that Mike Ashley of Sports Direct is close to an agreement to buy HoF from EY, the accountancy firm that was appointed this morning as its administrator.

A takeover of HoF by Sports Direct is likely to be announced later today, although it could yet fall through or see its interest trumped by another party, according to sources close to the talks.

If completed, the deal will represent a stunning coup for Mr Ashley, who has harboured a long-standing desire to move his retail empire upmarket by acquiring one of Britain's leading department store chains.

He has held an 11% stake in the business since 2014, and also owns close to 30% of Debenhams, its main rival.

Under Mr Ashley's stewardship, Sports Direct has accumulated stakes - often through complex financial instruments - in a number of British high street chains, including HoF's rival, Debenhams, and French Connection.

Sky News revealed last week that Mr Ashley was in talks about providing a rescue package to keep HoF afloat, although in recent days he had faced serious competition to buy the business from Philip Day, the billionaire behind Edinburgh Woollen Mill Group.

Details of Mr Ashley's plans for HoF, including how many of the 17,500 people who work for the company and its concession operators would keep their jobs, were unclear.

HoF's collapse into administration ended 169 years of solvent trading, and turned it - at least temporarily - into the biggest high street failure for more than a decade.

Sports Direct wrote to HoF's management last month to set out the terms of a rescue deal, saying it was "willing to structure a transaction on similar terms (subject to due diligence to confirm the level of investment/cash injection required" to one proposed by the Chinese owner of Hamleys.

Mr Ashley's company added that it had cash resources available for investment and the ability to support HoF in areas such as "warehousing, online sales and the running of the business generally".

After C.banner International abandoned a £70m funding deal, it left HoF needing £40m by August 20 to avoid going bust.

Bidders for the ailing department store chain were told to submit final offers for the chain on Thursday morning, with creditors working late into the night to thrash out a deal.

In a statement to the Luxembourg Stock Exchange, where House of Fraser bonds are publicly traded, Alex Williamson, its chief executive, said he was "hopeful that the current negotiations will shortly be concluded".

"An acquisition of the 169-year-old retail business will see House of Fraser regain stability, certainty and financial strength," he added.

A takeover of the business by Mr Ashley is likely to see its pension liabilities at least partly left behind with the Pension Protection Fund, the private sector-funded lifeboat, which will entail cuts to payments for some HoF pension scheme members.

However, a rescue deal by a well-capitalised business like Sports Direct will at least preserve a significant number of jobs at HoF.

More than 6000 roles had already been earmarked to be lost as part of a controversial process which was subject to a now-settled legal challenge from some of HoF's landlords.

Earlier this year, it was announced the Camberley and Epsom branches would shut - along with 29 others around the country.

Mr Day's takeover proposal would have seen HoF avoiding insolvency, while Alteri Investors, a fund specialising in buying distressed retailers, also made an offer.

The tussle over HoF's fate comes amid as an unprecedented list of high street names battle to avoid collapse.

So far this year, Maplin, Poundworld and Toys R Us UK have all fallen into administration, triggering about 10,000 job losses.

Numerous other chains, including Carpetright, New Look, Mothercare and - next week - Homebase, have turned to Company Voluntary Arrangement mechanisms to raise hopes of their survival, but at the cost of thousands more jobs.

Retailers have become casualties of a tough market characterised by rising costs combined with caution among British shoppers.

HoF, one of the best-known names in the British retail industry, has been living a hand-to-mouth existence for some time, with its shareholders periodically providing it with multimillion pound sums to enable it to pay landlords and concession operators.

Last year, it lost nearly £44m as pressure mounted on the business.

The company is carrying ‎hundreds of millions of pounds of debt, including a bond worth about £125m and roughly £250m of bank debt from HSBC and Industrial and Commercial Bank of China.

EY declined to comment, while Mr Ashley's spokesman could not be reached for comment.

 

 

Contact Us

If you would like to submit a query or provide more information on this story please get in touch below.

Please wait...
  • Up to 3 JPG or PNG images, 2MB max size
  • We will always endeavour to credit you when we publish your pictures.
  • By uploading you are agreeing to this non-exclusive reuse, royalty-free, across all Eagle Radio platforms, which extends to our partner broadcasters.
  • You retain copyright to all images.
  • If you would like to send us a video, please upload to YouTube or similar and paste the video URL into the message above.

Share This Story

Submit this page to reddit
Suggested articles

Sports Direct buys House of Fraser

Surrey and Hampshire News: It is not yet clear how this will affect their local branches in Surrey.

Royal Surrey A&E sees 'summer surge' because of heatwave

Surrey and Hampshire News: The number of admissions has been well up on last year.

Former DJ criticises Surrey Police after case thrown out

Surrey and Hampshire News: The force apologised after the collapse of the trial of Jonathan King for alleged historical sex offences.

Surrey customers among Currys PC World data breach

Surrey and Hampshire News: 10 million records including personal data may have been accessed.

Top articles

Parliament crash: Witness describes 'speeding car then a scream'

UK News: Witnesses have described the scene in Westminster after a car crashed into security barriers outside Parliament.

Wrestler Jim 'The Anvil' Neidhart dies aged 63

Showbiz: Wrestler Jim "The Anvil" Neidhart - the tag-team partner of Bret "Hitman" Hart has died at the age of 63.

Lindhagen Adds Versatility To Flames Roster

Surrey and Hampshire Sport: The Flames have added Erik Lindhagen from Nottingham Panthers. He can play Centre, Wing or Defence.

Raheem Sterling criticism is partly down to racism, says Ian Wright

Sport: Manchester City and England forward Raheem Sterling receives criticism motivated by racism, says Ian Wright.

Two men who died in California road rage fight identified

World News: Two men who died after a road rage fight in northern California have been identified by authorities.

Royal Mail fined record £50m for 'serious breach of competition law'

Business News: Royal Mail has been fined a record £50m by the communications regulator "for a serious breach of competition law".

Jessie the potty-mouthed parrot swears at firefighters while stranded on roof

Strange News: A potty-mouthed parrot flipped firefighters the bird as they tried to rescue it after it got stuck on a roof for three days.

Guildford Borough Council to start £25,000 weekly lottery

Surrey and Hampshire News: Proceeds will help fund local charities, sports clubs and other community groups.

Lindhagen Adds Versatility To Flames Roster

Surrey and Hampshire Sport: The Flames have added Erik Lindhagen from Nottingham Panthers. He can play Centre, Wing or Defence.

Guildford actress hits the big screen

Surrey and Hampshire News: GSA alumna to star in new Charlie's Angels film.

10 Things You'll Know If You Grew Up In Woking

Local Radio Day: If you grew up in Woking you'll know what we mean!

We 'Won't Get Fooled Again' by how good The Who are

On This Day: 70s: The album with this gem on was released on this day

It Was 13 Hours Of Non Stop Rock In New York

On This Day: 80s: On this day in 1988, Led Zeppelin reunited for the Atlantic records 40th Anniversary.

How Many Eurovision Winners Can You Name?

Quiz: Ahead of tonight's Eurovision Song Contest, how many past winners can you and your family name?

5 Stunning Wedding Dress Trends In 2018

Sponsored: We've partnered with Home Counties Wedding Fairs to bring you the best wedding trends of the year.

Dogalming returns...to Godalming!

Surrey and Hampshire News: The second annual charity dog show takes place today (August 11).

A new look for the Victoria Way car park in Woking

Surrey and Hampshire News: There are proposals to improve Woking's Victoria Way car park.

Woking FC set for new 10,000-seater stadium

Surrey and Hampshire Sport: The club's redevelopment plans have been given the go ahead.

Visit the Ward Williams website