By Eamon Quinn and James Davey
The Mandate Trade Union said there remains a level of concern among more than 200 staff at the House of Fraser store in Dundrum Town Centre — the sole outlet in the Republic — despite Sports Direct, the retailer controlled by Newcastle United owner Mike Ashley, snapping up the department store group’s UK stores from its administrators.
In a short statement to the London Stock Exchange, Sports Direct said it had bought House of Fraser’s 58 stores in the UK, its brand, and stock for £90m (€100m).
It gave no details of its plans for the business, the future of its staff — over 5,900 direct employees and 10,100 who work for concession partners — or who would be responsible for pension liabilities.
Earlier, House of Fraser had appointed Ernst and Young (EY) as administrators after talks with investors and creditors failed to find “a solvent solution” for the struggling business.
Certain regulatory matters had to be addressed before the acquisition of the Dundrum store can be sealed, EY said.
The store closed briefly yesterday for a staff briefing but subsequently reopened.
Mandate said it had written to EY and to House of Fraser seeking “an immediate meeting” over Dundrum and that staff remained concerned.
Dundrum employs 200 staff and also has a number of concessionaires.
Part of Mr Ashley’s plan for Sports Direct is to buy other businesses as well as strategic stakes.
It already owns fashion department store Heatons, which has numerous outlets in the Republic and the North, and has significant equity investments, including in Debenhams, French Connection, Game Digital, Findel, and Goals Soccer Centres.
The policy has not been universally successful. Last month Sports Direct booked an £85.4m charge for a disastrous investment in Debenhams.
“This is a hugely ambitious move for Sports Direct,” said Richard Lim of Retail Economics. “The combination of both businesses will yield some vital cost-saving synergies while it’s likely that some of the struggling House of Fraser sites will be rebranded to Sports Direct,” he said.
In Britain, it is further evidence of the torrid time facing retailers. A string of British store groups have either gone out of business or announced plans to close shops this year as they struggle with subdued consumer spending, rising labour costs, higher business property taxes, and growing online competition.
Irish Examiner and Reuters staff