6,000 jobs to head as Area of Fraser closures showed

Image: The closures will affect up to 2,000 House of Fraser staff and 4,000 across brands and concessions

House of Fraser has been given approval by creditors to close 31 of its 59 stores, resulting in up to 6,000 job losses.

The struggling department store chain will undertake the closures through a company voluntary arrangement (CVA), which will also allow it to secure rent reductions on its remaining shops.

:: The full list of stores that will close

Closures will affect up to 2,000 House of Fraser staff and a further 4,000 across brands and concessions.

The shops earmarked for closure, including its flagship Oxford Street store in London, will remain open until early 2019.

House of Fraser secured the backing of more than 75% of creditors, including landlords.

It was approved despite anger among landlords, who have complained that they are being forced to take a financial hit while House of Fraser enjoys new investment.

Image: House of Fraser's Oxford Street store is among those that will close

Alongside the CVA, Hamleys owner C.banner is being lined up to buy a 51% stake and invest £70m into the remainder of the business.

Landlords berated the chain's management and their advisers at KPMG over how the CVA was conducted, complaining that their share of the vote had been structured unfairly in an attempt to push through the restructuring proposal.

A representative for two of House of Fraser's landlords said there had been "no give" from the top team.

The company's boss, Alex Williamson, had warned that the move represented the "last viable" option to save the retailer, with the group at risk of collapse had the CVA been rejected.

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There are also plans to relocate its Baker Street head office and the Granite House office in Glasgow to help cut costs and secure its future.

The closures can be attributed to rising costs and business rates, competition from online rivals and a slowdown in consumer spending.

Original Article

Business

November 18, 2018