Your browser is no longer supported. For the best experience of this website, please upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

House of Fraser considers stock market return

House of Fraser could return to the stock market in a move to simplify its complicated ownership structure.

Chairman Don McCarthy, whose family owns a 20% stake in HoF, is understood to be spearheading the plans for a float of the business, according to the Sunday Times.

It would be the third time HoF has been owned publically, and it is thought the listing could value the retailer at between £200m and £300m.

Almost half of the department store chain, which has 61 stores, is owned by failed Icelandic banks, entrepreneur Sir Tom Hunter and Lloyds Banking Group.

The retailer has been subject to much speculation over the last year, with Sports Direct owner Mike Ashley and Qatari investors also previously rumoured to have held talks concerning a deal with HoF.

However these are reported to have fallen through over valuations of the business, shareholder disagreements and an onerous pension deficit.

Independent analyst Nick Bubb said the news of the impending listing would be “welcomed” because “the ranks of the mid-cap retailers have been denuded by takeovers and private equity buyouts.”

Bubb said it would be good to have another quoted benchmark for department store rival Debenhams.

However he added there are a trio of problems.

“One is that House of Fraser still doesn’t really make any money, despite its solid like-for-like sales record and impressive online sales growth, given its high fixed cost base,” said Bubb.

“Another problem is that the average cynical City fund manager will be wary of a business which has, apparently, been hawked around all the potential trade buyers without attracting much interest. And another problem is that it is still not entirely clear who owns all the shares in House of Fraser, given the murky Icelandic bank dealings and dispute about Kevin Stanford’s position.”

House of Fraser, which delivered a 3.3% rise in like-for-like sales in the year to January 26, declined to comment.

Readers' comments (1)

  • darren hoggett

    This doesn't look good for HOF. They clearly can't sell the business - which as pointed out doesn't make any money - so floating it is the next best thing as their business isn't showing any significant interest. However, that would change if their valuation was more realistic.

    HOF is fundamentally flawed. Walk into their stores and the customer is almost an inconvenience. Local variances to not appear to be taken into consideration and some brands would be shocked at how poorly merchandised their goods are.

    HOF comes across a retailer who actually isn't that bothered other than being HOF. So in turn, why should any potential investors be bothered by them?

    Unsuitable or offensive? Report this comment

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Links may be included in your comments but HTML is not permitted.