House of Fraser heads to China

published 10 April 2014

House of Fraser, the 165-year-old chain of department stores, has agreed to be taken over by a Chinese conglomerate for £450m. Sanpower, a retail, technology and real estate group headed by multimillionaire Yuan Yafei, is to take an 89% stake in the chain. It marks China's biggest investment in a UK retailer.

But it emerged early this week that Sports Direct boss Mike Ashley, who has been eyeing up House of Fraser for some time, has prevented the Chinese taking full control by snapping up an 11% stake. He has reportedly failed to buy out other shareholders, however, and is thought to be willing to sell his stake to Sunpower.

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Many will bemoan yet another UK company falling into Chinese hands, said The Daily Telegraph. But it's been a long time since House of Fraser could truly be called British. In 1985 it was bought by Harrods boss Mohamed Al-Fayed; in 2006 it was taken private by Baugur, the Icelandic retailer that collapsed two years later. Now the brand is heading to a huge new market with a growing middle class "the retailer's target audience".

Andrew is the editor of MoneyWeek magazine. He grew up in Vienna and studied at the University of St Andrews, where he gained a first-class MA in geography & international relations.

After graduating he began to contribute to the foreign page of The Week and soon afterwards joined MoneyWeek at its inception in October 2000. He helped Merryn Somerset Webb establish it as Britain’s best-selling financial magazine, contributing to every section of the publication and specialising in macroeconomics and stockmarkets, before going part-time.

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