New Fraser owner plots expansion
House of Fraser could nearly double its number of stores with plans to open up to 50 branches in China following its takeover by a Nanjing-based conglomerate.
The department store chain, which was valued at £480 million by the deal, currently has 60 sites in the UK and Ireland and new owners Sanpower plan to exploit what it calls the “iconic heritage brand” with a programme of international expansion.
However it is not known whether the name House of Fraser will be used at all the stores, with the possibility that some might use another name. One of those being considered is “Oriental Fraser”.
A source close to the deal confirmed that the chain would now be opening stores in China over the next few years, with 50 as a target.
Sanpower chairman Yuan Yafei said: “House of Fraser is a strong and iconic heritage brand in the UK and abroad, with exceptional fashion credentials.
“We see significant opportunities to develop the business further and replicate the already successful model in international markets.”
Announcing the deal at the weekend, he talked of plans to “unlock House of Fraser’s potential to become a leading global brand”.
House of Fraser already has one franchise store in Abu Dhabi, which opened last year.
Sanpower is expected to set out further details of its purchase of an 89% stake in the 165-year-old business in an announcement to the Shanghai stock exchange later. The deal is expected to complete in about four months.
The announcement comes after Sports Direct tycoon Mike Ashley bought an 11% stake in the business in a last-minute attempt to muscle in on the deal.
The chain said it did not expect to see any day-to-day changes for 7,300 House of Fraser staff and 12,000 concession employees. The store generates sales of £1.2 billion a year.
House of Fraser has its origins as a small drapery store in Glasgow, first listed on the stock market in 1948 and remaining a public company until it was bought by Mohamed al-Fayed in 1985.
It was listed again in 1994 before being snapped up in 2006 by a group of investors led by Icelandic tycoon Jon Asgeir Johannesson’s Baugur Group in a £350 million deal.
Sanpower is run by tycoon Yuan Yafei, whose empire spreads across finance, property, media, transport and IT and now employs 30,000 people with assets worth nearly £5 billion.
