Sports Direct has bought House of Fraser out of administration. The business and assets of House of Fraser, which includes the flagship store at Reading’s Oracle centre, have been acquired by Mike Ashley’s company for an estimated £90 million.
Alan Hudson, Hunter Kelly, Colin Dempster and Craig Lewis from EY’s Restructuring team were appointed earlier in the day as joint administrators to certain companies within the House of Fraser Group.
House of Fraser is one of the UK’s premium fashion, home and beauty retailer with 59 department stores across the UK and Ireland. The Group is the third largest group of traditional department stores in the UK and employs over 5,900 people. In addition, there are 10,100 who are employed in the various concessions with in the House of Fraser stores.
It has been well documented that since the withdrawal of the proposed Cenbest and C.Banner investment transaction House of Fraser has been in a race against time to secure sufficient funding to secure its future.
Since then the directors, representatives of the senior creditors and their respective advisors spoke with a number of parties in order to secure a solution. However, after exploring a range of options, it became clear that this would not be possible to achieve as a solvent solution and as such House of Fraser filed for insolvency protection. Shortly after EY’s appointment, the administrators confirmed they had completed a sale of substantially all of the group’s business and assets to the Sports Direct group.
Alan Hudson, joint administrator, said: “We have worked very closely with management, its advisors and creditors in recent weeks and are pleased that we have been able to successfully conclude a sale of the business in short timescales which preserves as many of the jobs of House of Frasers employees as possible. It was a challenging transaction to achieve in such a short period of time which will ensure continuity of the business and preserve the goodwill. We hope that this will give the business the stable financial platform that it requires to flourish in the current retail environment.”