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House of Fraser has fallen into administration, putting the future of 17,000 staff at risk.
The retailer said “significant progress has been made” in reaching a sale of the group’s business and assets however a “solvent solution” could not be reached between interested investors and its main creditors meaning it has no choice but to appoint administrators.
EY, which is expected to be appointed administrators today, is expected to continue those discussions in hopes of reaching a deal “shortly after their appointment”.
House of Fraser said parts of the department store could still be rescued, most likely through a pre-pack administration process, where a new buyer cherry picks the best assets, though thousands of jobs are still at risk.
Would-be suitors include tracksuit tycoon Mike Ashley and Philip Day, the billionaire owner of Edinburgh Woollen Mill.
Alex Williamson, chief executive of House of Fraser, 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 advisors 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.”
House of Fraser assured that its offices and stores will continue trading as normal while they look to reach a deal.
“All stores will be open for business as usual today,” it said in an announcement to the Luxembourg Stock Exchange.