Department store House of Fraser plans to close half its stores, as part of a rescue plan.
If the plan is approved, the retail giant will shut 31 of its 59 stores early next year. It is expected 2,000 House of Fraser jobs will go, alongside 4,000 brand and concession roles.
The department store needs the approval of 75% of its creditors to go ahead with the drastic cuts, which includes the flagship on London’s Oxford Street.
Creditors will vote on the insolvency plan, which involves company voluntary arrangements (CVAs), on June 22.
In May, House of Fraser’s Chinese owners Nanjing Cenbest reached a conditional agreement to sell a 51% stake to the Chinese owner of Hamley’s, C.banner. The sale is conditional on the restructuring plan being approved.
House of Fraser chairman Frank Slevin says it’s been a “difficult decision” but it is “absolutely neccassary” if the retailer wants to continue to trade and be competitive.
In addition to the store closures, the department store is seeking to cut rents by 25% on 10 of the stores it is keeping open.
Of the 31 stores it wants to shut, it is seeking a 70% rent reduction for seven months, after which the stores will close.
House of Fraser chief executive officer, Alex Williamson, comments: “Today’s announcement is one of the most important in this company’s 169-year history. We, as a management team, have a responsibility to take necessary steps to ensure House of Fraser’s survival, which is why we are making these proposals.
“I would like to offer my heartfelt thanks to all my colleagues at House of Fraser for working tirelessly throughout this difficult period. We are fully committed to supporting those personally affected by the proposals.”
The following House of Fraser store have been identified for closure:
London Oxford Street
London King William Street