House of Fraser denies sell-off amid Debenhams deal rumours

Published on Tuesday 16 June 2009 21:30

JENNERS owner House of Fraser has dismissed claims that it is to sell off its stores, quashing rumours of a deal with Debenhams.

Reports yesterday claimed that the rival department store brand was considering an acquisition of all or some of House of Fraser's 62 branches – including the iconic Edinburgh department store.

But the company issued a statement yesterday insisting it had "no intention" of selling.

However, in an interview with trade magazine Drapers, chairman Don McCarthy was yesterday reported to have refused to rule out a sale, saying that there "hadn't been any discussions" with Debenhams.

He was reported to have added that if a suitor thought House of Fraser may be a takeover target "they need to come and talk to us".

Debenhams last week raised more than 300 million through a share placing to "pursue opportunistic acquisitions".

The future of House of Fraser has been the subject of much speculation since the collapse of Icelandic retailer Baugur, which holds a 35 per cent stake in the firm. Scots tycoon Sir Tom Hunter has a further 10 per cent shareholding.

House of Fraser said in a statement issued yesterday that "following recent incorrect market speculation" it "currently has no intention of selling any of its 62 stores."

It added: "The department store continues to be in a strong financial position. The group is trading ahead of plan and is seeing sales on an improving trend with positive growth in the last 12 weeks. It is business as usual."

A spokesman for Debenhams refused to comment "on market speculation". However, under stock exchange rules, if the company was in discussions with a potential takeover target, it would have had to declare that at the time of its rights' issue prospectus, issued earlier this month.

House of Fraser yesterday said it had "cash at bank" in excess of 85 million and further working capital facilities of 36m.