Sports Direct has bought House of Fraser from administrators for £90m. The department store chain went into administration earlier today when it failed to reach agreement with creditors.
In a statement Sports Direct said: “The group has acquired all of the UK stores of House of Fraser, the House of Fraser brand and all of the stock in the business.”
Richard Lim, chief executive, Retail Economics, said Sports Direct would have its work cut out to turnaround the business and especially its online offer. “This is a hugely ambitious move for Sports Direct,” he said. “The combination of both businesses will yield some vital cost-saving synergies while its likely that some of the struggling House of Fraser sites will be rebranded to Sports Direct.
“Nevertheless, this is a part of the industry that is under a huge amount of pressure. Turning around the business will not come easy. The stores are failing to attract sustainable levels of footfall while battling against rising operating costs and shifts in shopper behaviour.
“As the business is reshaped, they will need to create a unique proposition, invest heavily in their online capabilities and create more meaningful in-store experiences if they are to thrive.”