Sanpower in advanced discussions regarding takeover bid for House of Fraser (HOF LN)
Sanpower, a Chinese conglomerate founded by Yuan Yafei, has submitted a takeover bid for the UK-based department store chain House of Fraser, The Sunday Times reported. Sanpower is in advanced talks with House of Fraser about a bid of more than GBP 450m (EUR 544m) for the retailer, the report said, without citing a source for the claim.
House of Fraser chairman Don McCarthy is believed to have accepted Sanpower’s bid last week, the item said. McCarthy and his family own about 20% of House of Fraser. The company’s other leading shareholders have also received details of the offer, according to the newspaper.
Sanpower and House of Fraser have been holding secret talks for months, the item said.
House of Fraser has held unsuccessful talks with potential buyers, the article added, naming French counterpart Galeries Lafayette and the retail entrepreneur Mike Ashley as two of those suitors.
The department store chain had been considering a flotation, and had hired the investment banks Rothschild and HSBC and the stockbroker Numis Securities to advise on the listing plans, according to the report.
A takeover would need to secure approval from the majority of House of Fraser’s owners, the item added, noting that representatives of collapsed Icelandic banks effectively control a 49% stake in the company.
Tom Hunter, a private investor, holds an 11% stake in House of Fraser, while Kevin Stanford controls a 10% shareholding, the item added.
House of Fraser refused to comment, the report said.
Separately, The Mail on Sunday reported that House of Fraser’s board members have been instructed to focus their efforts over the coming six weeks on preparations for a GBP 450m listing. The newspaper cited unspecified sources who said early meetings between House of Fraser directors, potential investors and advisers were “positive.”
It is thought that House of Fraser’s flotation prospectus will not be completed for several weeks, The Mail on Sunday item said.
Source Sunday Times, Mail on Sunday