Sports Direct’s controversial owner Mike Ashley promised to turn House of Fraser into the “Harrods of the highstreet” today, as his group announced the acquisition of the ailing department store chain for £90 million.
Sports Direct International plc made a statement to the London Stock Exchange that it has bought all of the UK stores of House of Fraser and all of the stock in the business.
House of Fraser said earlier this year that it planned to close 31 of its 59 stores, with the loss of more than 6000 jobs.
The acquisition by Sports Direct could preserve more stores than House of Fraser was able to commit to.
“We will do our best to keep as many stores open as possible. It is vital that we restore the right level of ongoing relationships with the luxury brands,” Mr Ashley said.
“Our deal was conservative, consistent and simple. My ambition is to transform House of Fraser into the Harrods of the high street,” he added.
The rescue is potentially good news for Fossil Group, which operates the WatchStation concessions for watches at House of Fraser department stores.
In a statement accompanying its 2017-18 financial results, Richard Collins, managing director of Fossil Group in the UK said that future sales could be affected by the House of Fraser difficulties. “An announcement has been made by House of Fraser after the reporting date that they have secured a CVA (Company Voluntary Arrangement) which will result in the closure of 24 stores that hold Fossil concessions from early 2019. The remaining 27 stores that hold Fossil concessions will continue trading,” Mr Collins disclosed.