Sports Direct, owned by billionaire Mike Ashley, has agreed to buy struggling high street department store House of Fraser for £90m in cash, it was revealed this on 10 August.
House of Fraser, which employs 17,500 people and has 59 stores across the country, previously announced it had entered administration after talks between investors and creditors broke down.
Later on Friday morning, Sports Direct boss and Newcastle United owner, Mike Ashley, stepped in to buy the ailing department store.
Why did House of Fraser enter administration?
Department stores have been having a difficult time recently, with other big names such as Debenhams and Next also struggling, both reporting a large fall in profits earlier this year.
Problems such as the rise of online retailers like ASOS and increasing rental costs has put added pressure on the industry.
While the department store entered rescue talks with a number of different companies, these have continued to break down over the past few months.
This left the department store chain without any options but to enter administration and hope for a buyer. Enter Mike Ashley.
What happens next for House of Fraser?
Full details of Mr Ashley’s plans for House of Fraser are yet to be announced.
The billionaire has held an 11% stake in the business since 2014 and also owns almost 30% of Debenhams, its main rival. It’s hoped that the rescue deal will save a significant number of jobs.
Today, all of the existing 59 stores will remain open, including the 31 previously earmarked for closure – one of which is the flagship store on London’s Oxford Street. According to reports Mr Ashley plans to keep 80% of all the House of Fraser stores open.
We’ll keep you updated when we have more information.
What are your rights when a company goes into administration?
When a company enters administration, your right on returns and exchanges will depend on what the administrator decides to do.
But as House of Fraser has been bought, it will be business as usual.
As always, if you paid for goods with a value of more than £100 using your credit card, you’re protected by section 75 of the Consumer Credit Act.
Update: Sports Direct is accepting no liability for House of Fraser gift cards issued before the department store was taken over. Read about why House of Fraser is rejecting gift cards.