£70m investment, but 31 stores shut
House of Fraser secures backing for restructuring plan
Closing: The Frasers store in Edinburgh is among 31 to close
Creditors have backed House of Fraser’s financial restructuring plans, triggering a £70 million investment from its new owner in exchange for rent reductions and 31 store closures.
Will Wright, restructuring partner at KPMG and joint supervisor of the company voluntary arrangement, said: “The approval of these CVAs provides House of Fraser with the breathing space it needs to proceed with its proposed operational restructuring plan across a smaller core portfolio of stores.”
As with all CVAs, more than 75% of creditors had to vote in favour in order to pass the resolution.
China-based C Banner will take a 51% stake in the business which will now be reduced to 29 stores. About 6,000 jobs will be axed. Among those closing is the store in Princes Street, Edinburgh. It also owns Jenner’s which survives the cull.
House of Fraser chairman Frank Slevin said the vote to approve the retailer’s store closure programme was “satisfactory”.
He added: “I am now focused on the implementation of the business plan. We will continue to focus on that going forward. Today has given us part of the solution to that.”
Mr Slevin added: “The approval of the CVAs is a seminal moment in House of Fraser’s history.”
He told the Press Association: “This is also an important milestone in the transaction with C.banner and moves us toward the completion of the capital injection first announced in May.”