House of Fraser to be sold off by Chinese owners

House of Fraser to be sold off by Chinese owners

House of Fraser is being sold by its Chinese owners in the latest sign of upheaval on Britain's beleaguered high street.

Sanpower-owned group Nanjing Xinjiekou Department Store is selling a majority 51% stake in House of Fraser to Chinese tourism group Wuji Wenhua.

It comes after recent trading troubles at House of Fraser and amid a dismal start to 2018 for UK retail, with Toys R Us and Maplin both collapsing into administration in February.

A House of Fraser spokesman said it was "business as usual" at the chain in the UK, adding that the move was "just a change of ownership".

Sanpower bought House of Fraser in 2014, but the deal has since proved ill-fated for the Chinese giant, with UK trading under pressure and little success in its plans to launch department stores worldwide.

House of Fraser reported a 2.9% fall in sales in the crucial six weeks to December 23, while online sales fell 7.5% after hiccups with the launch of a new web platform.

The chain was forced to ask for rent cuts on some of its stores in early January, while also overhauling its supplier base as part of moves to cut costs.

At the time of the Christmas trading update, Sanpower chairman Yuan Yafei said the Chinese group was "fully committed to its long-term investment in the UK retail market".

He added Sanpower would continue to provide "all the necessary support to ensure House of Fraser's success as the leading UK premium department store chain".

The group had planned to expand the chain internationally, with 50 House of Frasers planned across China under the name Oriental Fraser.

But it has only opened one House of Fraser in China - a store in Nanjing in late 2016.

Other minority shareholders in House of Fraser include Sports Direct founder Mike Ashley.

PA

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