House of Fraser is calling in EY as administrators after talks with investors and creditors had “not concluded in a solvent solution”.
In a statement to the Luxembourg Stock Exchange the department store said administrators had confirmed that the business would continue trading, including all stores and offices, while they attempted to complete a sale.
All 59 shops are set to open as usual on Friday, including 31 that have already been earmarked for closure as part of a restructuring agreement. This morning the firm’s website was offline, however.
House of Fraser employs 17,500 people, including 11,500 concession staff.
Court hearings are expected to take place at 7:30am today, “at which orders will be sought appointing individuals from Earnest & Young as administrators of each of the operating companies with immediate effect,” the filing said.
The firm added: “Significant progress has been made towards completing a sale of the group’s business and assets.
“The proposed administrators are expected to continue to progress those discussions with a view to concluding a transaction shortly after their appointment.”
HoF chief executive Alex Williamson said: “We are hopeful that the current negotiations will shortly be concluded.”
The department store’s fate has been hanging in the balance since its potential saviour, C.banner, called off plans to acquire a majority stake in the company, handing the retailer the task of finding funding of around £50m as it prepares to pay its rent bill and carry on trading.
Earlier this week HoF turned down a “lowball” offer to save 31 stores, and yesterday the business set a deadline of 20 August to secure fresh funding.
Chairman Frank Slevin added: “This has been an extraordinarily challenging six months in which the business has delivered so many critical elements of the turnaround plan. Despite the very recent termination of the transaction between Cenbest and C.Banner, I am confident House of Fraser is close to securing its future.”