Hunter demands HoF show its hand

Published on Monday 17 February 2003 00:00

SCOTS entrepreneur Tom Hunter yesterday called on retailer House of Fraser to show its hand amid growing speculation that management at the department store chain are mulling a buyout.

According to City rumours, HoF management under chief executive John Coleman are in the very early stages of discussions about taking the company private.

A HoF spokesman , which last month rebuffed a 197 million takeover bid from Hunter, last night declined to comment .

Hunter, who holds a stake of more than 7 per cent in HoF, urged the management to come clean over its intentions for the company.

"They need to explain if there is any substance to this speculation of an MBO," a spokesman for the retail entrepreneur said.

"Our view is that as a major shareholder in House of Fraser, we should be informed of what is going on."

The spokesman declined to comment on Hunter’s options if an MBO is formally proposed to shareholders.

The Takeover Panel ruled last month that Hunter must drop his bid for HoF for six months, but that ban could be lifted if management attempt to buy the struggling company.

Separately, Hunter revealed he will pump millions of pounds into a new equity fund to acquire and develop retail warehouse properties.

West Coast Capital, the private equity house run by the Scot, will launch a 300 million investment vehicle in partnership with Bank of Scotland and LXB Properties.

It is understood the project is a 50-50 venture between WCC and BoS. LXB, the company set up by the former management team from Grantchester, will operate the fund.

A spokesman for WCC said: "There are good opportunities in this sector which we want to develop, and it is an area we already know a lot about because of Tom’s experience in the retail industry."

Hunter owns a portfolio of about a dozen property investments, including three ventures with Nick Leslau’s Prestbury Holdings.

The spokesman said the fund will have no Scottish bias , and will look to snap up existing properties across the UK.

"Demand for warehouse space from retailers is strong," the spokesman said. "Planning rules are also putting restrictions on out-of-town developments."