House of Fraser brings in advisers to consider store closures

House of Fraser has become the latest retailer to look into store closures and rent reductions.

The department store chain has brought in advisers from KPMG, Sky News reported, putting a company voluntary arrangement (CVA) on the table.

This could involve closing some of the company’s 59 stores, as well as reducing rents at other branches.

Read more: House of Fraser plots new path as Chinese owner confirms commitment

The move follows informal conversations between the company and its landlords, in which it asked for rent cuts.

It is understood that talks with advisers are at an early stage, and that no decisions have yet been made on which option to opt for.

KPMG has previously overseen the CVA of Byron Hamburger, and has been linked to several other companies considering the option.

KPMG declined to comment.

House of Fraser has had a turbulent few months. Last month its Chinese owner Sanpower said it would sell a 51 per cent stake to another Chinese group Wuji Wenhua, but this has not yet been completed.

In the meantime, Sanpower has pumped an additional £30m into the business since September last year.

One other possible future move for the business could be a merger with fellow department store Debenhams, which is rumoured to be backed by Sports Direct owner Mike Ashley.

Sports Direct owns just over 10 per cent of House of Fraser, and recently upped its stake in Debenhams to more than a quarter.

Read more: Debenhams boss vows return to growth as profits plummet almost 85 per cent