House of Fraser confirms stores will close by 2019
Whether you’re a super-savvy saver or cash burns a hole in your pocket, there’s an expert tip with your name on it, says the Press Association’s Vicky Shaw
HOUSE of Fraser has had the green light from creditors to close more than half its stores, including its two in Wales, and axe up to 6,000 jobs.
The struggling department store chain will close 31 out of its 59 outlets through a Company Voluntary Arrangement (CVA), which will also allow it to secure rent reductions on its remaining shops.
Closures will affect up to 2,000 House of Fraser staff and a further 4,000 across brands and concessions.
This means all the stores that had been identified for closure, which includes the branches in Cardiff and Cwmbran, are anticipated to trade until early 2019.
House of Fraser secured the backing of more than 75% of creditors, including landlords, for the CVA at a meeting today.
House of Fraser says the restructuring which these CVAs enable is essential to both securing the company’s future and accessing new capital from international retailer C. banner.
It was voted through despite anger among landlords, who have complained that they are being forced to stomach a financial hit at the same time as House of Fraser enjoys new investment.
Azeemeh Zaheer, CEO of Naissance Capital Real Estate, the landlord of House of Fraser’s store in Cardiff had asked for the creditors meeting to be rescheduled to “allow sufficient time for the Company to reassess its financial position, update its increasingly out of date financial information and provide creditors with the information they deserve to properly understand the proposal”.
Ms Zaheer feels the CVA unfairly prejudices landlord creditors and is being used to secure a benefit for the retailer.
“The CVA is being used to cull property interests for the benefit of Limited and Stores without any genuine attempt to compensate landlord creditors,” she said.
Ms Zaheer will now be looking for new tenants for the Grade II listed building.
When the news broke that House of Fraser would be closing the Cardiff store Ms Zaheer said she had been contacted by three hotel operators keen on utilising the city centre site.
Commenting on the result of the vote, Frank Slevin, Chairman of House of Fraser, said: “The approval of the CVAs is a seminal moment in House of Fraser’s history. We must now continue with the implementation of our restructuring plan.
“This is also an important milestone in the transaction with C.banner and moves us toward the completion of the capital injection first announced in May.”
Alex Williamson, chief executive officer of House of Fraser, said: “The CVA proposals have been approved by our creditors and we are grateful for their ongoing support and belief in the future of House of Fraser.
“This was clearly a difficult decision to take but is, ultimately, the only one to secure our future.
“Our focus is on supporting all of our affected colleagues and we are exploring every opportunity available to them working alongside the Retail Trust and the wider retail community.”
What type of saver or spender are you? According to a new survey by HSBC UK, in partnership with YouGov, which quizzed people on how they handle their finances and their spending habits, there are no less than eight different personality types when it comes to managing our money.
Curious to know what yours is? Take HSBC’s online Bank-Life Balance test to find out (webforms.hsbc. co.uk/banklifebalance).
Meanwhile, here are the eight financial personality groups identified in the research, along with the percentage of people in each category – and tips for each one...
DRIVEN ACHIEVER (15%)
You feel you know what you’re doing when it comes to managing money. You’re comfortable pushing your financial boundaries if you think there’s going to be a pay-off.
Tips for driven achievers: People in this group tend to swap shopping habits based on speed and convenience. Try buying food online so you can save by planning meals.
SELF-SUFFICIENT SPENDER (14%)
You’re confident, independent in spirit and like to make life as easy as possible.
Although you’re not flashy, investing in quality matters and you like to live life your way.
Tips for self-sufficient spenders: You like to be loyal, but try shopping around instead of sticking to one supermarket to shave money off your bills.
SKILLED SAVER (10%)
You keep a tight rein on your finances and strict budgeting means you always stay on track. Your resourceful nature means that nothing goes to waste and you live within your means.
Tips for skilled savers: Skilled savers hate wasting money. So while you may not want to throw out your old sofa just yet, try freshening its appearance up with new cushions or a throw.
Also, since you love a bargain, try hunting around for discount vouchers if you’re planning a meal out.
TREND SPENDER (16%)
You’re ruled by your heart and aren’t scared of stretching your finances as long as you can maintain your lifestyle. If you see it, you want it!
Tips for trend spenders: Try giving yourself a few days’ breathing space after seeing something you like. That way, if you’re still thinking about it, you know it’s a considered decision.
You love to pile up your shopping basket – but try doing it for less money. Pop to the supermarket just before it closes to see if they have reduced any prices.
SENSIBLE SAGE (15%)
“Save now to spend later” is your motto. You see no point in getting into debt unless you can pay it off in full every month. Bargains matter, as does finding the best deal.
Tips for sensible sages: If you’re catching up with friends, look for local free attractions or pop-up food stalls that may offer great-quality food at a fraction of the cost of dinner on the high street.
BUDGET GURU (7%)
Your financial discipline and
determination to balance the books to come in on budget is the envy of your friends.
Tips for budget gurus: You may have firm habits – but why not try challenging yourself to trying something new once a month, such as a new hobby?
This financial personality group also tends to borrow more money than those in the other categories – not because they want to splash the cash irresponsibly, but simply to pay for everyday essentials. This is something budget gurus may want to address.
SPONTANEOUS SPENDER (9%)
Your friends come to you for wisdom, as you’re always trying new ideas. If it’s a choice of staying in to save money or going out to the latest restaurant, you’ll do the latter. Tips for spontaneous spenders: Try a bit of planning, such as making a shopping list before going out and avoiding shopping for food when hungry.
CONTROLLED SAVER (14%)
You’re cautious about any financial risk. You’ve little interest in labels and rarely splash out, but you’re loyal to the brands you know and love.
The personal touch is important, so you prefer to conduct your financial affairs face-to-face. Tips for controlled savers: Boost your savings even further by selling unwanted goods online before buying something new.
Controlled savers often steer clear of mobile apps - but these can be useful tools in helping to give a quick overview of your finances.