House of Fraser’s Chinese investor has pledged to provide about £30m to the embattled department store group.
Sanpower, controlled by tycoon Yuan Yafei, injected £15m into House of Fraser last week to help meet payments to concessionaires and landlords.
Sanpower is anticipated to provide at least the same amount again shortly. The cash follows £15m given to House of Fraser by Sanpower in September last year.
House of Fraser, like some of its department store rivals such as Debenhams, has endured poor trading for some time.
Credit insurers have cut supplier cover, and lenders to House of Fraser have drafted in accountant EY to advise them. The retailer is also understood to have approached distressed retail specialist Alteri for a loan of about £40m.
However, Alteri would have found it difficult to ensure security over any loan – House of Fraser’s bankers HSBC and ICBC already hold charges over the retailer’s assets.
House of Fraser chief executive Alex Williamson, the former boss of Goodwood Group who joined last year, aims to reinvigorate the business by adopting a more experiential business model and make the most of its status as the main source of premium branded product in many of the locations in which it operates.
House of Fraser suffered a 2.9% in-store sales fall over Christmas, when online sales plunged 7.5%. The retailer is talking to landlords about reducing its rent bill by almost a third over the next three to five years.
No comments yet