This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.bbc.co.uk/news/business-45140874
The article has changed 13 times. There is an RSS feed of changes available.
Version 3 | Version 4 |
---|---|
House of Fraser calls in administrators | House of Fraser calls in administrators |
(35 minutes later) | |
Department store chain House of Fraser is appointing administrators, putting thousands of jobs at risk. | |
However, all of its 59 shops are set to open as usual on Friday, including the 31 that have already been marked for closure. | |
House of Fraser - which began trading 169 years ago - employs 17,500 people, including 11,500 concession staff. | |
There is speculation that a deal to take it out of administration could be reached shortly. | |
In a statement, the retailer said that talks with investors and creditors had "not concluded in a solvent solution". | |
House of Fraser said administrators Ernst & Young had confirmed that the business would continue trading, including all stores and offices, while they attempted to complete a sale. | House of Fraser said administrators Ernst & Young had confirmed that the business would continue trading, including all stores and offices, while they attempted to complete a sale. |
The retailer's website was down on Friday, with a message that it would be "back up and running as soon as possible". | |
Earlier this month, Chinese firm C.banner pulled out of a rescue deal. Since then, a number of potential suitors have been in discussions with the retailer, including Sports Direct boss Mike Ashley and the owner of Edinburgh Woollen Mills, Philip Day. | Earlier this month, Chinese firm C.banner pulled out of a rescue deal. Since then, a number of potential suitors have been in discussions with the retailer, including Sports Direct boss Mike Ashley and the owner of Edinburgh Woollen Mills, Philip Day. |
In its statement announcing the administration, House of Fraser said: "Significant progress has been made towards completing a sale of the group's business and assets. | In its statement announcing the administration, House of Fraser said: "Significant progress has been made towards completing a sale of the group's business and assets. |
"The proposed administrators are expected to continue to progress those discussions with a view to concluding a transaction shortly after their appointment." | "The proposed administrators are expected to continue to progress those discussions with a view to concluding a transaction shortly after their appointment." |
What is administration? | What is administration? |
Administration is a formal procedure that happens when a company becomes insolvent - that is, its debts are bigger than its assets | Administration is a formal procedure that happens when a company becomes insolvent - that is, its debts are bigger than its assets |
The unfortunate firm is put under the management of insolvency practitioners | The unfortunate firm is put under the management of insolvency practitioners |
Once an administration order is granted, all legal action against the insolvent company is frozen for a period of about eight weeks | Once an administration order is granted, all legal action against the insolvent company is frozen for a period of about eight weeks |
During that time, the administrator can draw up a plan of action and propose it to creditors during a creditors' meeting | During that time, the administrator can draw up a plan of action and propose it to creditors during a creditors' meeting |
The administrator takes control of all assets and business operations | The administrator takes control of all assets and business operations |
Its aim is to act in the best interest of the firm's creditors, in order to repay as much as possible | Its aim is to act in the best interest of the firm's creditors, in order to repay as much as possible |
'Extraordinarily challenging' | 'Extraordinarily challenging' |
Chief executive Alex Williamson said: "We are hopeful that the current negotiations will shortly be concluded. An acquisition of the 169-year-old retail business will see House of Fraser regain stability, certainty and financial strength. | Chief executive Alex Williamson said: "We are hopeful that the current negotiations will shortly be concluded. An acquisition of the 169-year-old retail business will see House of Fraser regain stability, certainty and financial strength. |
"In the two weeks since the Cenbest and C.banner transaction ceased, the directors have brought forward a number of potential buyers and the group's financial advisers have run a comprehensive M&A process to identify and then develop other third-party interest that has culminated in the senior secured creditors leading negotiations with parties at a critical pace." | "In the two weeks since the Cenbest and C.banner transaction ceased, the directors have brought forward a number of potential buyers and the group's financial advisers have run a comprehensive M&A process to identify and then develop other third-party interest that has culminated in the senior secured creditors leading negotiations with parties at a critical pace." |
Chairman Frank Slevin said: "This has been an extraordinarily challenging six months in which the business has delivered so many critical elements of the turnaround plan. | Chairman Frank Slevin said: "This has been an extraordinarily challenging six months in which the business has delivered so many critical elements of the turnaround plan. |
"Despite the very recent termination of the transaction between Cenbest and C.banner, I am confident House of Fraser is close to securing its future." | "Despite the very recent termination of the transaction between Cenbest and C.banner, I am confident House of Fraser is close to securing its future." |
Andrew Dalton, director at specialist recovery firm Begbies Traynor, told the BBC's Today programme that it sounded as if a deal was close to being secured. | Andrew Dalton, director at specialist recovery firm Begbies Traynor, told the BBC's Today programme that it sounded as if a deal was close to being secured. |
"What it sounds like is... that there discussions ongoing with a particular party and that a sale of the business and assets will conclude either immediately upon the appointment of the administrators or shortly thereafter." | "What it sounds like is... that there discussions ongoing with a particular party and that a sale of the business and assets will conclude either immediately upon the appointment of the administrators or shortly thereafter." |
He said the management of the store chain had acknowledged the problems with the business. They recognised, "that, particularly in relation to the online offering they've been late to [it] and in the store portfolio, in terms of size and space, didn't really suit today's market". | He said the management of the store chain had acknowledged the problems with the business. They recognised, "that, particularly in relation to the online offering they've been late to [it] and in the store portfolio, in terms of size and space, didn't really suit today's market". |