Banks ‘seek assurances’ on HoF investment
House of Fraser’s CVA could be in doubt over concerns about its owner’s pledge to invest in the department store chain.
House of Fraser’s senior lenders, HSBC and Industrial & Commercial Bank of China, are demanding evidence that up to £70m of new capital, pledged weeks ago by owner Sanpower, will be injected into the business, according to Sky News.
House of Fraser is looking to seek approval of its store closure plans from creditors next week. Last year it lost £44m.
The chain said ‘constructive engagement continues between all parties.’
The future of the chain has been further placed in doubt by a serious delay to the deal that would have seen Hamleys' parent, Cbanner International, buying a 51% interest in the chain. Shareholders were due to receive information on the takeover by the end of May but this may not happen until 26 July ‘as additional time is required for the company and various professional advisers to finalise the contents,’ it said.
House of Fraser has hundreds of millions of pounds of debts and without shareholder support – Sports Direct owns 10% – faces the possibility of administration.