THE owner of Hamleys has entered into discussions to acquire a stake in troubled department store House of Fraser, it has been revealed.
C Banner International Holdings, which bought Hamleys in 2015, has signed a memorandum of understanding (MoU) with Nanjing Xinjiekou department store, a company affiliated with House of Fraser’s owner Sanpower.
The Chinese firms signed the pact in Hong Kong yesterday, which was followed by an official announcement later in the day.
The agreement signifies that C Banner and Nanjing have entered into talks about a sale of a stake in House of Fraser, although discussions are still at an early stage.
Shanghai-listed Nanjing owns an 89 per cent stake in House of Fraser, and is a subsidiary of Sanpower, a Chinese conglomerate chaired by billionaire Yuan Yafei.
Nanjing is also in discussions with tourism company Wuji Wenhua over selling a 51 per cent stake in the British department store.
The talks with Wuji Wenhua were first announced in March, but Sanpower did not rule out selling a part of its House of Fraser holdings to a third party.
The potential sale of a stake in House of Fraser has raised questions about Yafei’s commitment to the troubled retailer.
However, Mr Yafei has said he is committed to House of Fraser as it puts together a turnaround strategy.
It is unclear at this stage how a combination of two of the best known names in British retail would play out, but the move comes at a delicate time for House of Fraser.
The British department store, which has four sites in Scotland, has now enlisted advisers at KPMG to look at a possible restructuring that could involve store closures.
KPMG is exploring a number of options for House of Fraser, including a Company Voluntary Agreement (CVA), a type of insolvency procedure that would allow the retailer to close stores and cut rents on other outlets.
Why are you making commenting on The National only available to subscribers?
We know there are thousands of National readers who want to debate, argue and go back and forth in the comments section of our stories. We’ve got the most informed readers in Scotland, asking each other the big questions about the future of our country.
Unfortunately, though, these important debates are being spoiled by a vocal minority of trolls who aren’t really interested in the issues, try to derail the conversations, register under fake names, and post vile abuse.
So that’s why we’ve decided to make the ability to comment only available to our paying subscribers. That way, all the trolls who post abuse on our website will have to pay if they want to join the debate – and risk a permanent ban from the account that they subscribe with.
The conversation will go back to what it should be about – people who care passionately about the issues, but disagree constructively on what we should do about them. Let’s get that debate started!
Callum Baird, Editor of The National
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here