House of Fraser said a dispute over a share sale won’t derail the U.K. department-store chain’s plans to sell the business to China’s Sanpower Group.
Sports Direct International Plc Chairman Mike Ashley bought an 11 percent stake in House of Fraser from Scottish entrepreneur Tom Hunter about a week ago and tried to buy other stakes yet failed, the Sunday Times reported yesterday.
“This situation has no impact on our plans to sell to Sanpower Group and we will be making an announcement in due course,” House of Fraser said in a statement today. “We have sent legal letters to both parties, reminding them of the proper procedures to transfer shares, which have not been followed.”
House of Fraser, which has about 60 stores in the U.K. and Ireland, was planning to sell shares in an initial public offering this year after talks with France’s Galeries Lafayette broke down in January, two people familiar with the matter said at the time. The deal with Sanpower, which values the retailer at 450 million pounds ($746 million) may help the House of Fraser brand to expand in China and help the retailer resonate with Chinese shoppers traveling to the U.K., the Financial Times reported April 5.
A spokesman for Hunter said his lawyers have responded and that he’s comfortable with his position, while a spokeswoman for Ashley declined to comment.